Credit Score

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Do I Need Debt to Boost My Credit?

Much like no news is good news, no debt is a good thing. But what happens to your credit score when you don’t have debt? The answer is complicated. The short version is no debt can pose a challenge to someone looking to land an excellent credit score. Credit scores are intended to report your credit risk. In other words, they reflect how you have handled debt in the past. But having a high credit score is more complex than simply carrying debt. Understanding the factors that impact your credit score are important. There are many different strategies you can use to increase your score. [Spoiler alert: Going into debt simply to boost your score should be your last resort.] What Factors Impact My Credit Score? A combination of factors creates your overall credit score. Payment history has the biggest impact on your score and recent credit has the smallest.…

How to Improve Your Credit Score

Your credit score: most days you probably don’t think about it at all. But at pivotal milestones throughout your life, a good credit score suddenly becomes crucial. Your credit score affects your ability to buy a new car, qualify for student loans, get approved for an apartment or even land a job. With a good credit score, you’ll be able to finance a vehicle, get approved for an apartment with a safety deposit, and pass an employment background check. And with an excellent credit score, you’ll find yourself eligible for the lowest interest rates, with better chance of approval for loans and rentals, access to the best credit cards, higher credit limits, easier mortgage approval and so much more. No matter where you are in life, it’s worthwhile to put in the effort to move your credit score from bad to good, or from good to excellent. So where do you…

7 Common Questions About Credit Reports

The whole credit reporting system can seem a bit mysterious. In fact, when you first realize you have credit reports and a credit score, it may feel a bit like being graded for a class you didn’t even know you were enrolled in! To help demystify this important aspect of your financial life, here are answers to seven common questions about credit reports. What Information Does My Credit Report Include? Today’s credit reporting system is designed to provide a “just the facts” summary of your financial track record. Your credit reports provide a summary of your credit history. They include information provided directly by lenders and gleaned from public records. Credit reports do not include gender, ethnicity, religious affiliation, political affiliation, medical history, motor vehicle records or criminal records. And even though credit reports are focused on your financial history, they also don’t include information about your bank accounts. This…

How Your Credit Score Impacts Future Financial Goals

When it comes to your credit score, report and history, it’s important to remain vigilant, address issues, spend wisely and make payments on time.   Since your credit score is a reflection of your financial behaviors, your spending power is directly affected by your spending habits. A credit score also impacts your savings and future goals. Staying prompt with credit card payments and other debts will help to avoid a snowball of debt that may become unmanageable. And it will also help to maintain or improve your credit score over time. Establishing good credit creates a world of opportunity and sets you up for a future of great financial decisions. Even if your credit isn’t great, the good news is that it isn’t the end of the world. The Fair Isaac Corporation takes into account all of your credit behaviors, both good and bad. You will have plenty of opportunities…

Keep Your Finances in Balance With an Excellent Credit Score

Your credit score is much like an adult version of your GPA. It’s a grade that measures your level of financial responsibility in relation to others. Banks and lending institutions use your credit score when you apply for a mortgage, an auto loan or a loan for home improvements or a business. Credit card companies use scores to determine who qualifies for a card and at what interest rate. Increasingly, however, insurance companies, landlords and sometimes employers, study credit scores as a way to determine how responsible you are. Here are basics about where your credit score comes from and how to raise your score if it’s lagging behind the competition. Credit Reporting 101 The most widely used credit scores are FICO® scores, created by the Fair Isaac Corporation. Top lenders use FICO scores to help them make credit-related decisions every year. FICO calculates scores based on information in consumer…

Stay on Top of Your Credit Report With AnnualCreditReport.com

In early September, Equifax announced it had experienced a data breach affecting 143 million Americans. The breach took place between mid-May and July and was discovered by the company on July 29. You might be wondering: what is Equifax, and why should this matter to me? Equifax is one of three big credit-reporting companies. The other two are Experian and TransUnion. These companies generate credit reports that are used by lenders and others to determine if you are a good credit risk. Whether you know it or not, you are a customer of these companies, because they all compile data about you from credit card companies, lenders, banks, retailers and others, as well as from public records. For guidance on what to do in the wake of the Equifax breach, here are 5 Steps You Should Take To Protect Yourself after Massive Equifax Attack from Forbes and guidance from the…

How To Choose Your Next Credit Card

Credit cards can be a powerful tool or a horrible crutch for your personal finances. To enjoy success with credit cards, account holders have to juggle balances, due dates, minimum payments, interest rates, and other aspects of the account. When managed poorly, credit cards can lower your credit score and lead to thousands of dollars in interest. But when used responsibly, they can improve your credit score while offering valuable rewards like cash back and free travel. Decide if Credit Cards are Right for You Before you worry about which credit card is best, look at your finances and try to understand if a new credit card makes sense for you in general. Based on your past spending habits and experience with credit cards, are you able to manage and track your credit responsibly? Do you always make on-time payments or have you missed a few in the past? This…

Cash in on Your Marriage

With the fall wedding season right around the corner, what better time to think about the financial benefits of holy matrimony? These five perks make a strong case for joining lives – and wallets – with your significant other. Joint Income Tax Returns Tax rates for married taxpayers filing joint income tax returns are lower than for single or married taxpayers filing separately. And the standard deductions of a married tax filer are typically higher than itemized tax deductions. Filing jointly also helps if one of you earns a much higher income than the other. Why? Because your tax rates as a couple will effectively average out your total household income. Speaking of averages, combining income and expenses often helps lower the tax liability for married taxpayers filing jointly. Increased Credit Scores Provided that you and your spouse have good credit to begin with, combining your incomes will usually result…

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