Summary

Before we move on, let's review some key points from this chapter:

• You need to know all the relevant details about your debt before you can properly manage it.

• The rates you pay on your borrowing depend heavily on your credit score.

• Retirement savings and financial flexibility need to be a key part of most people's financial plans, even when—especially when—they're paying off debt.

• Some common “solutions” for debt, such as borrowing against home equity and tapping retirement accounts, often make matters worse.

• If you can't pay off unsecured debts like credit cards and medical bills within three to five years, you may need to consider bankruptcy.