What is credit? Credit, simply put, is making a purchase today with the promise to pay for it tomorrow. Typically, this involves establishing a relationship between a business and consumer based on financial trustworthiness and measure of risk. Typically, this depends on the 5 C’s of credit: character, capacity, capital, collateral, and conditions.
Using your credit wisely is the best way to avoid debt. There are certain habits, however, that can derail your efforts. Here are a list of bad habits that you should avoid in order to avoid falling into unmanageable debt.