Securing and managing credit

![CDATA[This chapter discusses the different kinds of credit that clients can use, how it can be used wisely and to the client’s advantage, and some pitfalls to avoid. Although many financial advisers focus on investment opportunities, there is a critical need first to ‘settle’ the client’s current financial affairs so that he or she can concentrate on building or maintaining their wealth. There are two reasons for this. The first is that, while a client is concerned with burdensome debt, he or she cannot think clearly about long-term investment results. The client may take a more conservative investment outlook and may hold off making necessary long-term decisions. The second reason is that, while a client is allocating a high portion of his or her after-tax earnings to interest repayments, that money cannot be used for investment purposes. This chapter also looks at clients as lenders so that both sides of the borrowing process can be appreciated.]]