Maintaining good credit is one of the core building blocks of successful money management. Everyone from potential employers to department stores use your credit history as a means of determining whether to offer you a job or a credit card. Which means that not managing your credit well can lead to being denied a job or being charged incredibly high interest rates on things like car loans.
The good news is that there are some very simple smart moves that you can make each day to help you build and maintain a good credit history.
Since most credit problems stem from overspending, you should make and follow a smart spending plan that details when, where, and how you spend your money thus allowing you to live comfortably without overspending or living beyond your means.
Lenders make assumptions about you based upon the patterns in your credit history. So avoid things that make them think twice about extending credit to you. One such example is maxing out your available credit. When creditors see that your credit cards are maxed out it raises a red flag and they may assume that you are having financial
The good news is that there are some very simple smart moves that you can make each day to help you build and maintain a good credit history.
Since most credit problems stem from overspending, you should make and follow a smart spending plan that details when, where, and how you spend your money thus allowing you to live comfortably without overspending or living beyond your means.
Lenders make assumptions about you based upon the patterns in your credit history. So avoid things that make them think twice about extending credit to you. One such example is maxing out your available credit. When creditors see that your credit cards are maxed out it raises a red flag and they may assume that you are having financial
problems and are using credit as a band aid.
As a rule of thumb keep your credit limits and balances manageable. The temptation is to get the most amount of credit possible but again this can lead to financial trouble as having too much available credit can be risky. You can run into difficulty making payments especially if you have a temporary income set back.
As a rule of thumb keep your credit limits and balances manageable. The temptation is to get the most amount of credit possible but again this can lead to financial trouble as having too much available credit can be risky. You can run into difficulty making payments especially if you have a temporary income set back.
Published: December 2, 2019
A smart move is to limit your credit and borrowing to no more than 20% of your net income. So for example if your net income is $40,000 per year, you should borrow no more than $8,000 year.
Avoid making one of the most common and arguably the most disastrous credit mistakes of all, and that is only paying the minimum balance each month.
Avoid making one of the most common and arguably the most disastrous credit mistakes of all, and that is only paying the minimum balance each month.
Habits To Help Improve Your Credit Score
If you only pay the minimum balance on your credit cards and other loans, then you will almost never achieve financial success because you will be in debt longer and you will end up paying much more in interest.
So no matter what, you should always make an effort to pay more than the minimum each month even its only $5.00 more – you will be better off in the long run.
What other smart moves do you suggest to help build and maintain good credit?
So no matter what, you should always make an effort to pay more than the minimum each month even its only $5.00 more – you will be better off in the long run.
What other smart moves do you suggest to help build and maintain good credit?
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