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Raise Your Credit Score

Raise Your Credit Score

Raise your credit score for better interest rates and easy lending from banks and financial institutions.
If you have never checked on your credit score, it is now easier than ever to see how you rate when lenders are looking at your financial record. Your credit score is based on your financial history in your credit record with all activity, both good and bad, influencing your score.

Three easy tips for maintaining or raising your credit score:

Pay off debt

Okay, I understand! That sounds much easier to say, but you can do it! I advise my clients to look at all of their credit card balances and pick the smallest debt. Changing your habits with small steps and small wins will increase your confidence and give you a chance to pat yourself on the back for a successful step toward financial health. Pay off the smallest debt and then tackle the next lowest bill. It is so gratifying to know one account has been paid off and with each paycheck, you whittle down more debt without intense emotional pain.

Keep low balances on bank-issued credit cards and revolving credit cards

According to Nerd Wallet, in 2016, the average U.S. household had nearly $17,000 in credit card debt. You are not alone. But you can reduce that debt. Pick one of your accounts and be sure to pay more than the minimum balance each month. Get one card down to a reasonable amount and then lower the balance on another card.
Not able to pay more than the minimum? It might be time to put those credit cards on ice. Literally! Take all but one of your credit cards, throw them in a container, fill it up with water and DEEP FREEZE those plastic cards. Now you can make payments on the cards each month and get that balance down.

Don’t open an excessive number of credit cards you don’t really need, in an attempt to increase your available credit.

If you have recently established credit, opening up four or five new accounts within two-three years could hurt your credit score, because you don’t have enough of a “track record” for the loan companies to make an educated decision as to your ability to manage your finances. In comparison, when a person has a few credit cards for eleven to fifteen years and later opens several new accounts, it may not have an adverse effect. What is more important than a lot of credit cards is the ability to make payments on time and demonstrate self-discipline in spending activity.

Don’t close several unused credit cards at the same time attempting to raise your credit score.

Positive credit scores are enhanced by a long credit history, so even if your account is not active, keeping an old card in your credit history gives you longevity and counts for about 15% of a FICO score.
A closed account will fall off your credit report sooner than an open one. In most cases, negative credit information will remain on your credit files for seven years from the time the debt first became delinquent. Here’s the good news: Positive credit information can stay on record indefinitely; however, closed accounts in good standing often drop off the credit report within ten years.
You can check your three credit reports for free once a year. 

Here’s a timely bonus that will raise your credit score this year.

Beginning September 15, 2017, the three credit reporting companies will phase in a host of changes that will lower the number of “mixed files,” which often had a negative impact on credit reports of people with similar names, and will update procedural changes aimed at improving the accuracy of these reports.
Find more tips for investing in you!

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GO the DISTANCE

Change your mindsetAsk yourself where you would like to be in one year or five years. Would you like to be free of credit card debt? Would you like to have traveled the world? Would you like to have put away money in a retirement account? Would you like to change your spending habits? Would you like to see 50,000 dollars in savings?

Once you know where you would like to be, state your goal. A year from now, I’d like to stop using credit cards. In five years, I’d like to be credit card debt free. A year from now, I want to go to school for additional training. In five years, I’d like to be in another career or own my own company.

Quiet the censor in your mind and just let your imagination travel where it likes. After allowing yourself this quiet time every day, you may be surprised to see where your imagination takes you! Take advantage of planning ahead then every three months or so, sit down and adjust your budget. You can still get to where you want to go, you are just allowing yourself to keep it real and tweak the plan, as needed.

Finances will always be a part of your life—not something you can ever move past. Confront your financial fears and set aside an hour per week to update your records. If you use computer software, download your bank statement and expenses. Balance your checkbook. Keeping up with your money each week for a small amount of time will help you stay on track for your bigger goals.

Make an effort to spend responsibly. Make a list of all bills you get each month, and then check them off your list as you pay them. That way, if you didn’t receive a bill, you still realize it has to be paid. Spreadsheets are a great way to keep track of expenditures. Once a year, list your assets and debts to get a sense of your net worth. Now you have a true road map of where you have been and can move more efficiently toward your current financial destination!