For some people, debt is the ultimate four letter word. Because the idea of owing a person or a financial entity money, they see debt as the ultimate bogeyman, something that can put them in a powerless position.

The reality is quite different, however. In modern life, debt is nearly essential. Its almost impossible to make some major purchase with a solid credit history, and that means borrowing money.

What does all that mean on the family level, though? Is there a reasonable family debt for the so-called “average” family that will given them purchasing power without taking on too much risk?

The answer is a resounding yes.

Opinions about reasonable family debt have changed over the years, but there’s little doubt that you need enough to establish a solid credit history.

The level of family debt you should be carrying, though, comes with a lot of variables. These include age, income, the size of your family, lifestyle and spending habits, and so on.

The old rule to establish this level was called the 28/36 rule. It was based on the idea that households should spend a maximum of 28 percent of the gross family income on house-related services (e.g., mortgage payments, homeowners insurance, etc), and no more than 36 percent on ongoing debt service (i.e., car loans, credit card debt, etc ).

This rule still applies to some extent, but its become more of a set of guidelines. The fact is that you can set your level of reasonable family debt anywhere you’d like, as long as you’re not engaging in reckless financial behavior that puts you and your family in jeopardy.

The most important factor in establishing your family debt is being aware of all the factors involved. Is your job stable? Are you on the verge of getting a promotion? Is saving money for your children’s college education a priority?

These are the kinds of questions you should be asking yourself and other family members when you establish your level of family debt.

But if you take into account your gross income, net income, expenditures, lifestyle habits, etc, you’ll be able to set up a level of family debt that will allow you to thrive and flourish!