About this blog

 For the past few years I’ve worked as a financial counselor, helping people to solve their debt problems. As a financial counselor for a major credit counseling agency, I get an in-depth look at the debt problems being faced by people everywhere. I started this blog because many of my clients are having the same type of money problems, and they have made similar mistakes in their financial decisions. Even more noteworthy, many of these financial mistakes could have been avoided.
  The hope is that by showing where people are going wrong in their finances, readers of this blog will avoid these all too common mistakes.
  And I do think that we all need to pay special attention to our finances now. Life is not only getting more and more expensive, it is also getting more and more complicated financially. There are so many different ways available to borrow money, and unfortunately, debt is becoming a necessary part of life for many people.
  There is nothing inherently bad about debt and borrowing money. But like with anything, there is good debt and there is bad debt. And with so many different types of credit available, plus an unprecedented need to borrow, a person needs to understand the differences between good and bad debt.    
  That is one of the biggest mistakes my clients have made by the time they need to seek out my agency’s services. They get into borrowing agreements that are simply bad business decisions on their part. The reason is because they didn’t understand that the terms of their borrowing agreement were simply not good. Part of my job is to educate my clients about these unfavorable lending terms, and these are the type of lessons that will be featured on this blog.
  My clients often tell me that I or another financial counselor at our agency helped them to better understand their finances. After hearing this from so many people, I realized that a blog such as this could help even more people.
  The credit counseling agency where I work is busy enough. My hope is that this blog will help people avoid financial problems so they never need to seek our services.

Note: All names used in this blog have been changed.

  1. While I agree with the premise of your statement, I disagree that there is “Good” or “Bad” debt. This statement has been over used by financail counselors and financial talking heads for decades.

    Debt is either “Manageable” or “Unmanageable”, the term good or bad is inaccurate and links too many financial products into a bucket, where anything mismanaged, misused or poorly applied becomes unmanageable……doesn’t mean it was bad, just means it was sold for the wrong application or to the wrong person.

    Example: For decades we have always been told that a house is so-called “good” debt but for the millions that just went through forclosure who were sold a home based on lofty appreciations and short-term gains, these people purchased a home that became “Unmanageable”, never was the loan a bad, or a good loan, the debt became unmanageable from a stand point of poor finanical planning and poor financial advice recieved, or poor application of a financial product.

    With your assumtions of good versus bad an Interest only home loan, or an ARM could be considered as “Bad”. Truth is a high percentage of home Purchasers successfully managed these type loans and used these products to their advantage…….you see, just because someone looses doesn’t mean the financial product was bad…….it just became unmanageable……same with a Reverse Mortgage…..they are not bad or good, but either manageable or unmanageable…..


    Phillip Day,President
    Academy of Financial Literacy, Inc

  2. Thank you for the comment. I agree that “manageable” and “unmanageable” should be used more by financial counselors when discussing debt.
    However, consider a multi-millionaire who charges a $20,000 vacation to a credit card that carries a 29.99% APR. The multi-millionaire then makes only the minimum payments even though he has plenty of money to pay off the balance in full at any time. He pays just the required minimums for decades and ultimately pays tens of thousands of dollars more than $20,000 for that vacation.
    This debt is certainly manageable for the multi-millionaire, but is the debt managed in the wisest way possible? I would say no. Much of what goes into a judgment of whether a debt is “good” or “bad” depends on how the debt is handled. So perhaps the correct language to use is this: Is the debt handled in the most financially beneficial way?

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