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Build Your Credit and Future with “Smart” Debt

For many people, bigger purchases in life can require borrowing money – and to qualify, you’ll almost certainly need to have a credit score. One way to build a good credit score is to have some amount of debt on which you make regular, on-time payments. But not all debts are the same, and not all borrowers have the same needs. It’s important to be careful and understand how to use debt to your advantage, rather than letting it take advantage of you.

AVOID DEBTS OF CONVENIENCE AND UNNECESSARY PURCHASES. INSTEAD, FOCUS ON DEBT THAT ADDS VALUE TO YOUR LIFE.

When you take on debt, consider what you’re gaining in exchange. You may get a loan for an item that you intend to use frequently, such as a vehicle, or perhaps you are buying something you think will increase in value, like a home. Or you may be financing something you consider an investment in your future, such as a college education. Managing debt wisely can help you build positive credit history.

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