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Decide how much credit you can afford right now


Life’s Financial Journeys

Heading Off to College
Getting Out on Your Own
Blending Two Lives
Having a Child
Emptying the Nest
Entering Retirement
Divorce
Death of a Life Partner
Military Life


A general rule of thumb is that other than a mortgage or rent, you should commit no more than 10-15% of your income to repaying credit. One way to achieve this is to use credit cards only as a convenience and make sure that you repay your balance in full each month.

Young people are often given opportunities to take on more debt than they should. Do not assume a lender who offers you credit knows that you can afford it. Only you can know that.

The following resources may assist you in deciding how much credit you can afford right now:

Calculate Your Debt-to-Income Ratio

How High Should Your Credit Limit Be?

Coping With Debt

Debt-to-Income Ratio Is As Important as a Credit Score


Getting Out on Your Own Tasks

1. Finding housing
2. Building credit access and usage
3. Reaching financial goals
4. Setting up a spending plan
5. Getting properly insured

Building credit access and usage Subtasks

1. Learn about credit reports and credit scores
2. Take steps to strengthen your credit reputation
3. Compare revolving and installment credit
4. Decide how much credit you can afford right now
5. Identify appropriate sources of credit and how you will use them

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