SoFi Blog

The average American household carrying a credit card balance has over $16,000 in debt, but you sure wouldn’t know it. People talk all day long about their workouts, favorite apps, and their love lives, but bring up the subject of money, especially credit card debt, and suddenly everyone clams up.

Borrowing to pay for college, a down payment on a home, or even a car is a financial given for Americans striving to reach their long-term goals. These loans are as common as Sunday brunches and binge watching Netflix. And with the rising popularity of personal loans, it’s clear that they, too, are becoming a part of the financial journey for many people.

It’s the classic financial dilemma: you’ve got a home improvement project you’d like to start or maybe you have some unexpected medical bills, but you don’t want to dip into your savings to cover the expenses.

If you have good credit, a personal loan could be the answer. But there’s a lot to consider, especially if you’re paying off student loans while also trying to build a solid nest egg. Here’s a five-point plan to help you out:

Editor’s Note: The following article on home renovation and budgeting originally appeared on our web partner Houzz’s website. Some of the content has been slightly edited from its original version, and is written from the perspective of a home designer.

Remodeling is a great way to stay in the house you have. Plus, making changes can improve the way you live. But everyone has heard the horror stories of going 50 percent or more over the remodeling budget. Truth be told, even contractors will admit that it’s hard to provide an exact price on the work, because there are often unforeseen circumstances that could cause the price to rise. I always recommend factoring in about 20 percent over what you think you should budget. But knowing what you want from the very beginning — and sticking to those goals — can greatly help your project stay on track. Even if it seems like it’s going off the rails.

Credit cards. They’re just small, rectangular pieces of plastic, yet have the ability to help people prosper—or cause unexpected financial damage. SoFi members Peter and Gloria Hoch of St. Louis, Missouri, know something about that. Together for 36 years, the couple racked up about $23,000 in credit card debt in just over five years.