Bad debt is debt that makes you poorer. I count the mortgage on my home as bad debt, because I'm the one paying on it. Other forms of bad debt are car payments, credit card balances, or other consumer loans.

In this quote, Robert Kiyosaki discusses his perspective on bad debt, which he defines as any debt that reduces your financial wealth over time. He explains that debt becomes "bad" when it requires ongoing payments without generating any future income or value. For Kiyosaki, a mortgage on a home is considered bad debt because, although it's often seen as an investment, it still represents a financial burden that he is responsible for paying. He contrasts this with other types of bad debt, like car payments, credit card balances, and other consumer loans, which also lead to financial strain.

Kiyosaki’s view challenges traditional beliefs about debt, especially the idea that owning a home is a solid investment. While many people consider a mortgage a necessary and potentially wealth-building debt, Kiyosaki argues that it is still a liability because it requires constant payments without directly contributing to wealth generation. In his view, the key to distinguishing between good and bad debt is whether the debt creates income or merely drains your resources.

He also points out that consumer debt, such as credit card debt, is particularly harmful because it often carries high interest rates and doesn't lead to the creation of any asset or income stream. These types of debts, according to Kiyosaki, only make individuals poorer over time, as they require people to spend money that could otherwise be invested or used to build wealth.

Ultimately, Kiyosaki’s quote emphasizes the importance of understanding the impact of debt on your overall financial health. He advocates for a mindset where individuals seek to avoid or eliminate bad debt, focusing on assets and investments that generate income rather than taking on debt that only burdens them. This approach is central to Kiyosaki’s teachings on financial literacy and wealth-building.