Here's when to use credit:

1. If you need equipment to do your job and you will account for the cost of money over time as a decrease in your pay. For example, if you're a mechanic, you need a big tool set, and you might need to go $10,000 in the hole to pay it off. There are any number of Paydown Planners on the web to tell you what those tools will actually cost over time - say $17,000. If you're going to earn $75,000 with your $17,000 tool set, AND you don't take on any other debt, it's worth it. If you can't pay the $17,000 and your other bills without MORE debt, you can't afford it.

2. Performing assets. Homes were, until recently, a performing asset, in that they increase in value more than the rate of inflation and the cost of your money. The crux of the whole thing that's happening now is this isn't working anymore, at least for houses. On the other hand, for education it does work. A college education VASTLY increases your salary, and can be paid off over a LONG time, so it can been seen as a well-performing debt.