A Practical Guide to Credit and Loans

Debt is climbing across the board right now, and Kiplinger put together a full guide to help people figure out when borrowing actually makes sense and when it doesn't. Michael McAuliffe, President of Family Credit Management, showed up twice in the piece with some straightforward, practical advice.

The first tip is about knowing your own numbers before you borrow. A lot of people don't actually sit down and look at where their money is going until they're forced to. Michael's point was simple: once you actually look at your budget, you often find room to cut back and borrow less than you thought you needed.

He also flagged a mistake he sees often: people using a loan to pay off debt without changing the habits that got them into debt in the first place. Someone consolidates their credit cards into one loan, feels a sense of relief, and then keeps using those same credit cards since the balance is back down to zero. Before long, they're carrying both the original loan and new credit card debt. Michael's advice was blunt but useful: more loans aren't the fix if the spending habits underneath them don't change.

It's a good one to bookmark if you're weighing whether to borrow, especially the reminder that a loan can solve a math problem without solving the actual problem.

Read the full article at Kiplinger.