Long-Term Debt

Debt! An extremely scary word. Debt is what a company owes to another company. Generally this means that someone (usually a bank) gave them money with the expectation that they will pay back the money within a certain time frame. Lot’s of companies have debt, and a little bit of it is okay but a lot can be dangerous. Always look at the amount of debt a company has before investing. Try comparing the debt to other things like total assets and last years sales to see if the business could easily pay it off quickly. Debt is just another one of those things you’ve got to learn about before investing.

That’s all for now, Ben


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