What is debt in personal finance?

Debt is money you owe to another party under agreed repayment terms. Common examples include credit cards, mortgages, auto loans, student loans and personal loans. The key variables are balance, interest rate, fees, payment amount and repayment period. A useful debt plan protects on-time payments first, then targets expensive balances while preserving enough cash for essential expenses and emergencies.

Practical takeaway

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