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Why should you reduce spending on credit before investing

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You read in Chapter 13 that it is vital to reduce your credit card balances and other consumer credit before beginning an investment program. You also need to start an emergency fund in case of immediate need. Why do financial advisers make such recommendations?

Why should you reduce spending on credit before investing? Why shouldn't you carry large consumer debt and invest at the same time? On the surface, these questions may sound silly but there are sound reasons for asking them.

Reference no: EM131289403

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