There’s a saying I used to hear when I was younger: “Start building your assets as early as possible.”

Back then, the idea behind it seemed pretty simple:

a) If you don’t have the cash to buy something outright, it’s often better to use financing and get the asset now rather than wait and save up.
b) Let’s face it—making a promise to yourself isn’t quite the same as having to stick to a payment plan with a bank.

As I got older, I realized there’s more to this strategy than just taking on debt. For it to really work, a few things need to be in place:

a) A solid plan: You need to know how much you can realistically commit and stick to a budget. Without that discipline, it’s easy to get in over your head and end up in financial trouble.
b) Willingness to deal with the downsides: Debt comes with a price—interest, insurance, and possible fees if you miss a payment or hit a rough patch.

Of course, whether this approach makes sense really depends on the market. For example, in the U.S., mortgage rates for first-time buyers are often low enough that buying a home ends up being cheaper—and smarter—than renting.