Prime Capital Investment Advisors Jason Noble and And Merchant discuss how debt can help and hurt your financial planning. Good debt and bad debt are two types of debt that differ in their impact on your financial health. Good debt is a type of debt that is considered an investment, such as a mortgage or student loans. It is taken on to purchase something that will increase in value or contribute to your overall financial health. On the other hand, bad debt is used for purchasing material things that lose value over time, such as credit card debt with high interest rates.