By Andrew Rosen via Iris.xyz

You can tell a lot about a person by their finances.  Usually, I look at ones assets and make some pretty good assumptions about how they save.  However, a lot can be learned simply by someone’s credit card debts.  It serves as a glimpse into that person’s financial soul.

When I have the opportunity to meet a potential new client and they reveal some outstanding credit card debt, I ask the same two questions every time.  I want to know how they accrued this debt and why.  By their answers, I’ll know: A) a tremendous amount about them financially (and personally) and B) how to remedy this situation.

Below, I’ll list the 3 most common answers received and the recommended treatment.

Answer 1:

I’ll often hear the credit card debt was the result of a one-time occurrence they couldn’t avoid.  This ranges anywhere from needing a new roof to medical expenses they simply had to pay.  I sympathize and understand expenses occur that are unexpected and unplanned.  Thus, desperate measures result and credit cards are used.

What this tells me:

This individual is, most importantly, not chronic abusers of destructive debt.  They had a situation outside of their control.  After doing a cost benefit analysis, they determined fixing the leaky roof or seeking medical care was worth accruing some short term credit card debt.

Click here to read the full story on Iris.xyz.

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