The Varieties of Debt
It’s important to gain a general understanding of the different types of debt that are out there and available to you. While this is less of a specific Strategic Debt Practice or application and more of a meta-practice or big picture practice, it is nonetheless very important, because it relates to and underlies all of the other practices. For example, the answer to whether to pay down a certain type of debt often depends on which kind of debt it is, and while achieving and maintaining an ideal debt ratio is very important, once again, you don’t want to make that happen by taking on the wrong kind of debt.
To this end, Table A.1 lists the major types of debt that you as an individual or family are likely to have access to, along with a number of characteristics of that debt.
The far left column on the chart lists the different types of debt, and then for each type of debt the following characteristics are considered: