The topic of this month’s discussion is debt. Of course, in the ideal world, where we all have more money than we need, we never need to borrow. Most of us, however, don’t live in an ideal world. Some things in life do require that we borrow money.

Not all debts are created equal. In my opinion, there are good debts and bad debts.

To me, borrowing money to obtain an education is a good debt. In most fields, people improve their earning potential with additional education.

Borrowing money to purchase a house is also a good debt. Most people cannot buy a house without borrowing, and the joy of home ownership cannot be easily measured. The government also provides an additional benefit by allowing homebuyers to deduct their mortgage interest at tax time.

As we have previously discussed, however, you should not consider buying a house until your personal finances are solid. You should have a steady job with sufficient income, have enough saved for emergencies and be able to contribute regularly to your retirement accounts.

Finally, borrowing money to start a well-thought-out business is considered a good debt. While some businesses can be started with little or no start-up costs, many businesses require significant costs to get started, which means you might need to borrow money.

Now, let’s talk about bad debts.

For most people, owning a car is a necessity. A car loan, however, is not.

Granted, if you have very little money but you need a car, you might have to borrow money to buy one. If you have enough money to buy a reliable new or used car, however, borrowing money to buy a more expensive model would be bad debt.

An even worse debt is credit card debt. It’s perfectly OK to have credit cards, if you have the discipline to use them like debit cards and pay off the full balance every month. If you can’t pay off a purchase in the same month, maybe you shouldn’t buy it.

Unlike some people, I do not think you should ever carry a balance on your credit cards. There is a reason why people get credit card applications every other day. The credit card companies make money when people buy things they can’t afford and have to pay interest and other fees.

Save your money. Live within your means. The credit card company executives make more than enough money.

• Andy Su, MD, is an emergency physician who works full-time at the Sutter Tracy Community Hospital Emergency Department and a board member of the Tracy Hospital Foundation.