College Credit Tips

Credit card debt is a huge problem in America, especially with the status of the economy. Most people are having to turn to their credit cards to buy the things they need most in life, causing their debts to soar tremendously. If you are in credit card debt at the moment, know that you are not alone. There are thousands of other people out there just like you. CreditCards.com has an incredible list of statistics that show just how significant credit card debt is at the moment. I thought I would share a few of those statistics, just to put matters into perspective.

• 76 percent of undergraduates have credit cards, and the average undergrad has $2,200 in credit card. Additionally, they will amass almost $20,000 in student debt.
• About 45 percent of consumers said their unpaid credit card balance had gotten “lower” or “much lower” in the past 12 months. Only 26 percent said it had gotten “higher” or “much higher.”
• As of 2007, the majority of U.S. households had no credit card debt.
• As of March 2009, U.S. revolving consumer debt, made up almost entirely of credit card debt, was about $950 Billion. In the fourth quarter of 2008, 13.9 percent of consumer disposable income went to service this debt.
• Average credit card debt per household with credit card debt: $15,799
• In 2007, credit card balances made up 3.5 percent of the total debt for all U.S. families, including those with and without credit card debt.
• In 2007, fewer than half of U.S. families (46.1 percent) held credit card debt. That’s virtually unchanged from 2004′s 46.2 percent number.
• Of the 73.0 percent of families with credit cards in 2007, only 60.3 percent had a balance at the time of the interview; in 2004, 74.9 percent had cards, and 58.0 percent of these families had an outstanding balance on them.
• The average balance per open credit card — including both retail and bank cards — was $1,157 at the end of 2008. That’s up from $1,033 at the end of 2006, a growth of nearly 11 percent in two years.
• The mean, or average, unpaid credit card balance last month was $3,389. The median is $90.
• The typical consumer has access to approximately $19,000 on all credit cards combined. More than half of all people with credit cards are using less than 30 percent of their total credit card limit. Just over one in seven is using 80 percent or more of their credit card limit.
• Total U.S. consumer revolving debt fell to $866 billion at the end of 2009, down from $958 billion at the end of 2008. About 98 percent of that debt was credit card debt.
• Undergraduates are carrying record-high credit card balances. The average (mean) balance grew to $3,173, the highest in the years the study has been conducted. Median debt grew from 2004’s $946 to $1,645. Twenty-one percent of undergraduates had balances of between $3,000 and $7,000, also up from the last study.

If you can find a way to pay for the things you need on your administrative assistant salary, do so. If not, at least now you know that you aren’t the only one out there with overwhelming credit card debt. Even I have a grand or two in debt that I’m still paying on from college. Sometimes, it just happens. All you can do is save up to pay off your current debt and hope you don’t develop any more of it in the future.

When most people think about their credit, they immediately think about their credit report and score. What they don’t realize is that there are a lot of forms of “credit” that never show up on a credit report. I’m referring to aspects of your life’s history that are going to have an impact on your loan applications and other areas of your life. Before you focus solely on building your credit, you may want to build your application details in general. Those will have just as much of an impact in the end. Here is a look at some forms of personal credit that never actually make it to your credit report.

Work History

The time you spend on the job will play a big role in your future credit apps because it shows people that you can commit to something for a long time. It also shows that you have a reliable income and will be able to pay back whatever money they give to you. You are more likely to get a loan after years as an administrative assistant than you are after three months as a CEO. Sometimes history is just more important than status.

Residence History

Lenders want to see that you have been in the same home for a long period of time because that ensures that they will be able to track you down if they ever need to. This is especially true when it comes to financing a vehicle because the lender needs to know where he or she can repossess the car from if there is ever a need. If you move around a lot for work or something else, you may have a harder time getting a loan than someone else would. You won’t know that for sure though until you give the application a try.

Rent

If you rent your home, you may not get credit for the rent you pay every month. Homeowners with mortgage payments usually get credit because they have an actual loan for their home. Renters aren’t quite so lucky. They don’t have a loan, so they pay tons and tons of money for housing without seeing any effects on their credit. The same applies for renting furniture in most cases, though there are some companies that will report to the credit bureau. Just don’t expect a lot to come from something you are renting. It won’t make any difference.

Bills

You may have to pay your utility bills once a month, but that does not mean that you are getting credit for them all the time. This is one of the things that frustrate me a lot because I feel like making positive payments on bills should be a sign of good credit. Nevertheless, the only way you’d ever get credit from your utilities is if you didn’t pay the bill and it went to a collection agency. Then you’d just end up with bad credit, which sort of defeats the purpose.

Building your credit is going to be tough no matter what, but it is important to still keep the other areas of your life on track. If you fall behind on your bills, you may have to pay higher deductibles for them in the future. If you move around too much, you may be denied of a loan. Take all of these factors into consideration and try to set up a scenario that will let you get whatever help you need later on in life. You’ll be much better off if you can do this.

Most people fall into debt at some point in their lives. This is especially true in a tough economy like the one we are experienced right now. If you are over your head in debt, you may want to train yourself to save money so that you can get out of it soon. Something as simple as putting away part of your LPN salary every month could have a huge impact on your debt at this time. Here are some tips to help you manage your debt, improve your credit, and maintain your sanity all at the same time.

Save for One Debt at a Time

One of the easiest ways to stay on track for your savings is to save for one debt at a time. Let’s say that you have three credit cards and a $5,000 loan that you need to pay off. You may make a goal to pay off one card first, and then make another goal for a second card after that. Then you can pay off the final card and leave the loan for last. You’ll feel proud of yourself for paying off the credit cards, which will motivate you to pay off the loan debt. If you can do this for all of the debts you have, you will be able to pay off the full set in no time.

Autodraft Your Savings Money

If you have a trouble actually putting money away for your savings, you may want to have it automatically drafted from one bank account to the next. The best way to do this is with a CD because that will make the money less accessible for you. I did this once, and I actually paid off a credit card because of it. This will only work if you can predict when you are going to get paid, but it is definitely something to look into. Test out the system and see what you think. Worse comes to worse, you can remove the draft and find another solution for paying off your debt.

Work with Cash

When you have cash in hand, you have a clear picture of the money you do and don’t have to work with. With a debit or credit card, it is easy to eat into your savings because you don’t have anything blocking you from swiping the card. With cash, you have a clear idea of your financial situation at all times. That will prevent you from spending your savings money because you couldn’t control the swiping.

If you are worried about the safety of cash, you could get a prepaid Visa card to use instead. That way you still have a spending limit, but you have a way to cancel your card if you get robbed. Wow, bad note to end a paragraph on. Hmmm, pink bunnies in cotton candy. Yes, much better.

Turn Savings into Bills

You have to think about your savings account as a bill, not just something you strive to fill eventually. The second you start assuming that you will eventually save money is the second you lose out on the opportunity to get out of debt. There is no time like the present, so you just have to learn some self-discipline and save. I know this is hard to do. I have had to go through the process countless times over. No matter how hard it may be though, you have to find a way to get it done. Think about your debt like you do your electricity, and you will have a much easier time regaining your financial freedom.

In theory, you should be able to get credit for making consistent payments on anything you have in life. That would logically imply your bills, like the utilities, rent, cable, etc. While there are some cases where a landlord will report rent payments to the credit bureau, most of the time you will not be able to get any credit from paying your monthly bills. As much as this may suck to hear, it is something you just have to deal with. You have to pay the money, even if it doesn’t seem like you’re getting anything in return.

However…

There are exceptions to this rule that you need to keep in mind. For instance, your rent may not be considered something worthy of being reported to the credit bureau, but a mortgage payment would be. If you own your own house, the payments you make on the loan for it should go to your credit history. With rent, you aren’t really paying a loan. It’s more like an extended hotel fee. With a mortgage though, you have a certain amount of money that you are trying to hit throughout the years. There is a big difference.

You also have to take into account the fact that you can get negative credit from not paying your bills. When I moved recently, my husband and I forgot about a cable bill that we needed to pay before we left. Eventually we got a letter in the mail about it, and we still didn’t pay it for some reason. I think we were both just thinking about where we were living at the time, not necessarily taking care of the bills we had in general. That was a dumb mistake. That past due bill eventually showed up on our credit, even though the positive payments we made didn’t show there. You have to think about that before you ignore your bills completely.

Alternative Credit That Comes with Paying Your Bills

Even though you may not get actual credit from paying your bills, you may be able to get a form of credit from this process. Most companies will keep track of your payment history so that other companies of the same kind can inquire about your trustworthy in the future. If you move to a new city and need new services, you may be able to avoid paying a deposit because you have credit with another company. My mother in law was able to avoid a $200 deposit on her utilities after a move just because she had great payment history with her former water and electrical companies. If you can maintain a similarly good history in your own life, it should pay off in the future.

You will also get good credit from having a long residential history or being in good standing with a company for a long period of time. Lenders like to see that kind of history, even if it does not directly impact your credit. It shows stability and loyalty, which is all they really want out of someone when they give him a loan. Use that as motivation to pay your bills on time.

Conclusion

You may not be able to get a 700 credit score just by paying your bills, but you can see positive benefits from doing so. You may want to delay you bill payments a tad if you have to choose between them and a loan payment. Just don’t delay them so much that you will end up with a bad payment history. Ideally, you should pay all of your bills with your forensic scientist salary all of the time. That is what is going to get you the best overall results in life.

Having a great credit score can open a lot of doors for you, but you don’t always need credit to get through life. This may sound counterproductive for me to say, seeing that this entire blog highlights the importance of credit and the steps you can take to make your credit score better. Nevertheless, I do know that it is popular to get through life without credit to fall back on. I have done that for about a year now because some medical bills have caused a significant fall in my credit score. If you have a really bad credit score or you don’t have one at all, you may still be able to get through your life just fine. Here are some tips to help you make it without using credit at all.

The Wonders of Cash

If you don’t have sufficient credit, you most likely won’t be able to get a loan or credit card to use. That will force you to pay for everything in cash. I don’t necessarily consider that a bad thing though because it forces you to assess your budget and spend your money wisely. It is easy to fall into debt with good credit because you can get anything you want. You can buy a car that is outside of your means and spend credit cards like they have no limits. At the end of the day though, you lose sight of your financial situation. You can’t do that when you have to pay in cash.

The Fight to Save

Seeing that you will have to pay for most of the things you buy outright, you are going to have to learn to save money. This may be a struggle at first, but it can actually be quite fun over time. My husband and I never used to save. When we had it, we spent it. Plain and simple. Now that we have gone through this whole car accident/medical bill/credit score of doom situation, we have had to learn to stretch our money just like everyone else. At this point, we are actually saving $5,000 a month to go towards our rent for next year, which we will pay off before we even move into our new place over the summer. That is a really really really really good feeling, and it is one that I would encourage anyone with credit problems to strive for. You may struggle at first, but that struggle will all be worth it in the end.

The Inevitable Compromise

If you don’t have credit to rely on, you will just have to find a way to compromise about what you want or what you “need.” You may want a $30,000 car, but you will have to settle for the $6,000 one that you have cash for. Learning to compromise is never easy, but it is something you just have to do when you don’t have credit. You will start assessing your money in a new way because you are basically your own bank. You can’t rely on anyone else to help you out. You can only do what you can do with your tattoo salary.

Living without credit is tough, and it is not exactly pleasant to get used to. Nevertheless, it is something that you can fight through if you know how to use what you have to work with. Save every single penny you can, and try to keep up on whatever payments you still have to make. That way you can hopefully build up your credit in the future. By that time, you will have good financial habits to carry you through life.

The economy isn’t exactly in the best of shape now, no matter where you live. Gas prices keep climbing, and all the other prices seem to follow along with it. If you are struggling to pay your bills right now, you are not alone. Nevertheless, you have to be aware of the damage a missed payment could do to your credit. Before you miss a payment completely, there are some steps you need to take to minimize the damage to come. That way you won’t have to live with a bad credit history in the future. Listed below are some suggestions to help you get through a possible missed payment with as little damage as possible.

Ask for an Extension

If you think you could logically pay off your bill shortly after your due date, you may want to ask about an extension. Most places will probably charge you a late fee, but they will at least let you make your payment without any penalties on your credit. I have to do this on occasion because I don’t always get paid in a predictable manner. I may get paid on a Monday one week and on a Thursday the next, depending on the clients I am working for at the moment. If you make a clear plan to pay something back within a given time frame, you should be able to get the leeway you need to fix the situation.

Pay Part of the Bill

In some cases, you can pay a portion of the bill to avoid any complications with your credit. I was in a really bad car accident a while back, and it left me without the ability to pay much of any of my bills. I kept my phone on for two months straight by just paying $50 towards the bill and making a payment plan for the remainder of the bill. If you can at least make a partial payment towards your commitment, you can show the lender or service provider that you are making an effort to fix the situation. They will hopefully show you some compassion after that.

See If You Have a Grace Period

Your due date isn’t always your official due date. It’s just the date that a place would like to see a payment by. Most places have a three to ten day grace period, where you can make your payment without any type of penalty. For instance, my rent is due on the first of every month, and I have three days after that for a grace period. If I do not pay by the end of the fourth, I have to pay a $25 late fee and $10 per day that I am late. You can talk to your bill collectors about the possibility of a grace period and see if you have any wiggle room from there.

Discuss Your Options

As tempting as it may be not to contact your bill collectors when you think you will miss a payment, you really need to. The more you communicate with them, the more likely they are to help you out. When I was in my car accident, Capital One actually took care of my payments for three straight months until I was able to start paying them back again. They did that because I spoke to them early on about my options. You have to find out what your options are and whether or not you will be able to work within them. Then you just have to do everything you can to make your payments.

We live in a world that is almost entirely run on the internet. We do everything from researching Strayer University reviews to socializing with Facebook on the internet, and most of us get on it once or more a day to do something. I happen to work on the web, so I spend about 8 to 12 hours on it a day – sometimes more. Needless to say, I rely on the internet to control my life.

A lot of people do not realize that they can manage their credit cards online, which can save them time and hassle as a whole. If you did not realize that, it may be a good time to start looking over your options so you can make full use of them online. Here is a look at just a few of the ways you could control your credit cards via the World Wide Web.

Check Your Balance

Once of the first ways you could use the internet to manage your credit cards is by checking your card balance online. You can see detailed information about the last payment you made, the current payment that is due, and the total balance of money you owe on the card. By reviewing this information, you can make a plan to pay off your credit card in a timely manner so it gets off your credit. Then you can start improving your score, all because you kept an eye on things on the web.

Monitor Transactions

Before I started checking my credit card online, I would forget about a lot of transactions that I used my credit card for. Then I had to go through the embarrassment of having my card declined in public, which was nothing short of a nightmare. Even if you keep a close eye on what you use your card for, you can watch the transactions online so that you catch any forms of identity theft should they arise. That hopefully will not be a problem for you, but you never know unless you are careful and aware. The internet allows you to quickly glance over where your money is going so you can adjust your spending habits accordingly.

Pay Your Bill

My favorite credit card management option online is the ability to pay my bills. I can either transfer money from my bank account to my card or use my debit card to make my payment. I even have one card that I can pay through PayPal, which is convenient for me because I work online. PayPal is essentially my bank account. If you want to pay your balance off shortly after you use your card, you can do so easily online. That will allow you to build your credit and still stay out of debt at the same time. If you use the powers of the internet carefully, you can see a big difference in the way you benefit from your credit cards.

Final Thoughts

Yes, you can do most of this without using the internet, but why would you want to? If you can make your payments and watch your balance online without ever having to use the phone or the mail, you could save yourself a ton of time. Wake up, pay the card, get to work, and live a normal life. That’s the way it should be. The easier it is for you to take care of your card, the easier it will be for you to stay out of debt. Keep all this in mind as you start exploring your options online. You might be pleasantly surprised about what you can do.

A good credit score can make a big difference in your life, more so than you may think. Most people do not realize the value of their credit scores until they start looking for loans in their lives. I used to have a 720+ credit score, but that has fallen tremendously because of some medical bills on my record. I’ve seen the good and bad sides of credit, and I can attest to the perks that come along with having a high credit score. They are well worth the effort if you can improve the score you already have. Here is a look at what may happen to you if you have good credit in the future.

No Income Verification

A lot of banks will not ask for proof of income if a person has a really high credit score. If you need a loan for a car or for some personal expenses, you may not have to turn in check stubs to prove you make a certain amount of money. That is not to say that you should lie on financing applications. That is far from the case. This just makes the process of getting a loan a lot easier in the long run. If you are self-employed and trying to get a loan of any kind, a lack of income verification will probably make the act go a lot smoother.

Low Interest

The amount of interest you have to pay on a loan or credit card will make a big difference on the amount of bills that you have every month. If you can obtain a low interest credit card, you are less likely to fall into credit card debt. If you can get a low interest rate on a loan, you will have a lower payment to worry about every month. You may be amazed by how many little to no interest lending opportunities there are in the world, and you cannot obtain them with a low credit score. That is why it is so important to improve your score when you can.

No Down Payment

If you are trying to get a loan for a house or a car, you may be able to do that without a down payment if your credit is really high. I financed a $38,000 BMW when I was 21, and I didn’t put a single penny down on it. That was because I had outstanding credit at the time. I recently purchased a $27,000 Mercedes, and I had to put $9,000 down on it because my credit has slipped so much. That just goes to show you the difference that a good credit score can make in life. You basically get the VIP service no matter where you go.

No Collateral

Most lending companies nowadays will not issue a loan for someone unless he or she has some sort of collateral to use for the loan. That may be in the form of a house, a car, or something else with a title on it. If you don’t have any form of collateral, you can still get a loan if you have a good credit score. The lenders will basically overlook your lack of loan property because they trust that you will pay them back.

You don’t have to do anything at all to get a loan when you have good credit. You just have to show up and sign the paperwork. If that sounds like something you may be interested in, you need to make a strong effort to raise your credit score for the future.

When most people think about their credit, they think about their credit score. This is basically a grade for your ability to pay back loans, and it is definitely something that you need to keep an eye on in your life. Nevertheless, it may not be necessary to focus on the score as much as it is to focus on the credit history. That will actually tell more to a lender than a simple score will. Let’s take a look at some of the things your credit history may be telling lenders about you. That way you can do whatever it takes to get a positive history going.

What Your Credit History Says about You

Your credit history tells lenders what your payback experiences have been over a long period of time. It shows how long you have had loans or credit cards that you are making payments on, and that lets lenders know if you can be trusted with a monthly payment over a long stretch of time. If you have a long credit history with consistently positive payments, you are going to be much more likely to get a loan than you would with a short or bad credit history.

Your credit history will also explain why your credit score is as high or low as it is. When I got hit with medical bills after an accident, my credit score dropped considerably. Nevertheless, I was able to get a loan for a new car because I had good credit history before that. Most lenders will try to look at the total package before they deny someone a loan opportunity, so that is something to look forward to if you had a recent decline in your credit. As long as the history is there, the lender should at least consider your application for funding.

The history of your credit further illustrates your ability to make payments on time. Lenders can see if you have consistently late payments on your car, credit card, personal loan, etc. and they will keep that in mind whenever they assess your application for a loan. If you have been 30 days late on a lot of payments, you are not going to be treated with the same consideration as someone who always makes his or her payments on time. A little bit of good history goes a long way.

How to Improve Your Credit History

If you want to make sure that your credit history looks the best it possibly can, try to get a month ahead on all of your revolving payments. Your history will not show that you are a month ahead, but it will display the positive payments you have made every month. If something happens to make it impossible for you to make a payment at a certain time, this will give you a backup to avoid a bad mark on your history. Do this all over the place and your creditors will be impressed.

Your credit score is going to reflect on your credit history, so try to make it a positive one. Avoid getting into credit card debt or taking out loans that you can’t pay back. Only extend the amount of credit you can logically pay, and then the consistent payments that you make will look fantastic on your applications and your paralegal cover letter. If you want to be taken seriously in the lending world, you have to have a track record people can trust. Use that knowledge as motivation to keep your history strong for the future of your finances.

Credit monitoring programs can make or break your credit score, and they are well worth the money you spend on them in the long run. Some credit monitoring programs are only $15 a year, but others will charge $15 a month. If you have the money to spare though, these sites could be a great source of security for your identity. I have written a lot of other articles on this blog about credit monitoring because I truly think it is an important part of maintaining a good credit score. Listed below are 21 of the most popular credit monitoring programs online, along with a link so you can explore the sites further. Use this as a reference to protect yourself in the future.

1. Identity Monitoring
2. Debt Wise
3. Identity Protection
4. Credit Check Total
5. Credit Expert
6. ID Patrol
7. Family Secure
8. Credit Keeper
9. Score Watch
10. Trusted ID
11. Triple Advantage
12. Equifax Complete
13. Identity Protect
14. Privacy Guard
15. Privacy Matters
16. Credit Insure
17. Triple Alert
18. True Credit
19. Identity Guard
20. TransUnion Credit Monitoring
21. Credit Secure

This is not a comprehensive list, as there are tons of other credit monitoring options out there. You just have to explore all of those to figure out which one may be right for you. Check out reviews of the sites listed above, and try to read about the fees you will encounter with them. Every one of them is different, so you need to make sure you know what you are getting yourself into. With the right credit monitoring program, you should be able to protect yourself enough to maintain a good credit score in the future.

Check out some of my other articles for more information about credit monitoring:

• What Is Identity Theft Insurance?
• Credit Monitoring on the Go
• How to Check Your Credit Report for Free
• Does Credit Monitoring Prevent Identity Theft?
• Unexpected Forms of Identity Theft to Watch for

Hopefully some of the information in those articles can help you keep a keen eye on your credit in the future.

If you apply for loans and credit cards without actually checking the requirements for the applications, you could end up with a ton of avoidable decline letters in your mail box. Car dealerships and credit card companies will try to get you to fill out an application no matter what, but you need to ask questions before you do so. Having a lot of inquiries on your credit can lower your score, and it can make you look a little desperate. Before you do that, you need to make sure to ask the right questions. That way you avoid applying for a loan that you blatantly don’t qualify for. Listed below are some of the questions you need to keep in mind before filling out a credit application.

Do you require a minimal credit score?

If you know what your credit score is, you need to find out if the lender or creditor will accept it for your application. For instance, most banks want to see a 600-650 credit score or higher before giving out a loan on a car or a home. Some lenders will go as low as 500, but there are very few out there that will go below that. Before you apply for a loan with a bad credit score, you need to make sure yours is acceptable.

If you don’t know your score, you can get it from a place like Identity Guard. You’ll have to pay for it at first, but you can cancel the account after you see your score. Then you will know what to ask about in the future.

Will my income be sufficient for a loan?

Make sure that the amount of money you make is enough to support a loan. This will depend on your debt to income ratio, or the amount of money you owe versus the amount of money you make. Most banks like to see 40% or lower, including loan payments. On top of the amount of income you make, you also need to make sure that the type of income you make will be okay. I’m self-employed, and I have had a lot of problems with that in the past. I learned to make this the first question I ask. If you have a police officer salary or something else pretty standard, you shouldn’t have to worry about having problems.

Will my credit issues be okay?
If you have a bankruptcy or repossession in your past, you need to ask about that before you fill out your application. A history of delinquency could cause you to get an instant decline, and so could a lack of credit. If you ask about that though, you can avoid having a credit pull on your already rocky credit.

Do you work with people in my area?

Some lenders will only work with people in their town or county, so you may want to check on that if you are trying to get a loan long over a long distance. I buy all of my cars out of state, so that is always one of the first questions I ask about a loan. If they say they can’t work with people in another area, I know not to waste the application.

Do you offer loans under these circumstances?

Make sure that the lender you are working with offers the kind of loan you want. For instance, you may want an unsecured loan or a loan on an older car. Some lenders will only work with loans that have collateral backing them, and vehicular collateral has to be less than eight years old. Check in on all of that when you fill out your applications, and you will be able to avoid unnecessary declines from the start.

In most of the articles I have on this blog, I talk about reasons to get rid of credit card debt and improve your credit score as much as possible. For the most part, it is a better idea to keep your credit card balance low because it will keep your score high and your revolving debt low. Nevertheless, there are a few benefits that come along with high credit card balances, and you may want to keep those in mind. Before you pay off your credit card completely, think about the information below. It will help you determine what you should do with your money.

High Balances Lead to Higher Spending Limits

I have had several credit cards with Capital One over the years, and some of them had higher spending limits than others. I called to ask about increasing the limit on one of my cards so I could make a big purchase, and the company informed me that I had not maxed out my card enough times to see an increase. Unless you use your card the way the credit card companies want you to use it, you may never get a chance to increase your spending limits. Thus you may want to keep a high balance for at least three months to see if it improves the amount of money you have available to you.

High Balances Make You Spend Less

When you have the full balance of a credit card left over, you may be tempted to rely on it as if it is extra money for you. That used to always be my mentality until I used my credit cards to pay for an expensive piece of furniture. Once I had the cards maxed out, I no longer relied on them for help. Thus I was basically forced to work for my money, which was a lesson I needed to learn. If you need a quick swift in the rear, try paying on a card that you can’t use. It’ll make you regret ever spending the money on it in the first place.

High Balances Show Consistent Payment History

If you are able to pay for your credit card for several months in a row, you will be able to establish a credit history for banks and other cards to look at. They can see that you have had a good history with a credit card company, and then they may extend a line of credit to you. This is not always the case, but you can use a high balance to build your credit score. You just need to make sure to pay it off month by month.

Do the Pros Outweigh the Cons?

While there are a lot of perks that come with having a high credit card balance, there are also a lot of cons to keep in mind. High credit card balances mean high revolving debt, which may look negative in the eyes of a future lender. A high balance is also an excuse to throw away your money because you won’t be paying much beyond interest with it. For the most part, there just aren’t enough positives to outweigh the negatives that come along with high balances.

If you are going to keep your balance high for a little while, make sure you keep up with your payments. That way people can at least see that you are making an effort to cover your debt. With the right amount of payments, you could improve your score and still keep a high balance at the same time.

My husband and I love picking out new cars together because we both like the same things. For some couples though, selecting a car together may seem like an almost laughable experience. Hubby wants high horsepower and wifey wants great gas mileage. How the hell are you supposed to find something you can both drive? Believe it or not, there are a lot of ways to compromise so that everyone gets a little bit of what he or she wants. You just have to be prepared to let go of one or two wants along the way. Here is a quick guide to help you get the perfect car to drive as a couple.

Think about the Budget

Before you can even begin to think about the car you want to buy, you need to think about how much money you will be able to spend on it. It’s time to put your accounting cap on. Without having a clear view of your family budget, you may end up looking for cars that are way above your means. You either need to think of a cash price that you would be willing to pay on a car or think about the monthly payments you can afford to make. If you have to ask yourself, “what is accounting?” you may want to get someone else to help you figure out what you can logically afford.

Lay out All the Wants

Once you know how much money you have to spend, you need to know what each of you wants in a car. You need to write down a list of what you want in terms of power, amenities, fuel economy, size, and everything else you can think of. Then you can start discussing those wants in detail so you can get an accurate idea of what you want as a couple. It is possible to have the best of both worlds, but you have to know what those worlds are in the first place. By writing down lists of the factors that you want in a car, you can get on the same page from the start.

Research Candidates for Cars

Once you know what you want in a car, you can start trying to find a vehicle that will actually suit those wants and your budget at the same time. My husband and I both like fast cars, but we recently decided that we wanted something that would also hold a family in the near future. That is why we decided to look into luxury sports sedans. We can still get the power we want without having to sacrifice the comfort for our future family. If you are young and you both just want power, you can look for sports cars. If you just want something environmentally friendly, you can research hybrids. Start sifting through different cars until you find something you like.

Find the Best Prices

After you figure out a few different cars you may be interested in, use AutoTrader to find the best price possible on them. You can search for multiple cars in your area that have certain miles or fit within a certain price range. Then you can call about the cars if you have questions. You can usually find the best deals by looking slightly out of your area, depending on where you live. I lie in Texas, and I just bought a car from Tennessee last week. If you find a good deal that you can get financing for, take it up while you can.

Do you have a credit card bill that you just pay the minimum on every month? If so, you may notice that your credit card balance is practically the same now as it was when you made your purchases. If you simply pay the minimum on a credit card, you may not ever be able to pay the full balance. I think I read somewhere that it would take over 10 years to pay off a $1,000 credit card bill if all you covered was the minimum payments. That is a long time to pay off a very small amount of money. Let’s take a look at why this works the way it does so you can determine how to adjust your finance management to improve the situation.

What Your Credit Card Minimum Actually Pays

When you just pay the minimum on a credit card, you are mostly paying the interest and late fees on it. A very very very very very very very small portion of the money goes to the principle of the balance, but the bulk of it goes directly to the pockets of the credit card executives. Any good CPA will tell you that you can never get anywhere by just paying interest. That is money that does not impact your balance at all. If you shell out $15 a month for a credit card and $11 of it goes to interest in fees, you can see how long it may take for you to pay everything off. That is the grim reality of credit card payments.

What If All I Can Afford Is the Minimum Monthly Payments?

If you are living on a tight budget at the moment, you may not be able to pay any more than the minimum monthly payments for a credit card. That is fine, but you just need to know that it is not going to get you anywhere. You will eventually have to start making higher payments on the credit cards if you ever want to get out from under the debt of them. For now though, the minimums are at least enough to help you avoid getting bad marks on your credit. If you can continue to cover those, you will at least not have to worry about dropping your scores just because you have some outstanding bills on a small credit card.

How to Pay Off Credit Card Debt

If you want to actually see your credit card balance go away, you need to make an effort to pay more than the minimum balance on it every month. The more you can pay off each time, the less money you will be charged for interest in the future. Even something as simple as an extra $10 a month will significantly improve the amount of time you have to live with credit card debt. If you can possibly save enough money to pay it all at once, do so. Then you won’t have to worry about it ever again.

Only you know what you are financially capable of at the moment. If you have enough money to be able to pay off the balance of your credit cards, then you need to stop paying the minimums and just start paying the balance off. If all you can scrounge up is a minimum payment for now, you can at least keep your credit looking good with that. Just figure out a plan of attack to get rid of that balance lingering above your head, and you’ll be on your way to financial freedom in no time.

The snowball method for credit repair is a concept that involves paying off small debts first until all that is left are the big debts to cover. This follows the same theory as building a snowball, where you have a small ball to start with that gradually builds into a larger one. The snowball method is great in theory because it gives you a chance to see your debts going away one by one. Nevertheless, this process is not exactly ideal. Here is a look at how the snowball method works so you can determine if it is something you may want to try.

The Purpose of the Snowball Method

The snowball method is supposed to encourage you to continue paying off your debts by allowing you to see them getting paid off. If you start with a small credit card, you can at least check that bill off your list every month. That will help you feel accomplished, and it will give you the confidence you need to continue paying off your bills. Over the next few months, you can pay off another debt and then another debt until all you have left is one large debt to pay on every month. This will relieve a lot of your stress, and it should allow you to focus on your credit repair most effectively.

The Downside of the Snowball Method

The snowball method is great in theory, but it does have a downside. Large loans require more money in interest, and that can cause you to pay a lot extra over time. If you leave those loans until the end, you may be shelling out hundreds of extra dollars that you could have saved by paying large loans first. You could try to do a reverse snowball method, but that may not provide you with results quickly enough for you to feel good about your credit repair. That is why in many cases, the fact that you have to spend more money with this process is relatively irrelevant.

How to Use the Snowball Method Effectively

If you want to be able to use the snowball method to your advantage, you need to assess the amount of interest you have to pay on different loans. If you have five credit cards with a 6% interest rate and then one with a 20% interest rate, you need to try to pay off the 20% card first. That way the balance doesn’t continue to spiral out of control. If you want to still start with the smallest balance that you have, try splitting the payments between the high interest card and the small balance one. That way you can still get something paid off without having the bills pile up on the other end.

You could also look into transferring some of your high interest debt onto a low interest credit card to pay off. If you don’t have to worry about the interest rate, you will be able to use the snowball method to its full potential. This is rarely the case, but it is certainly something you could benefit from if it did work out for you. Check out your credit card options and see if there would be any way to lower the interest you pay right now.

Conclusion

The snowball method is not right for everyone, but it could be right for you. Give it a try and see if you get an exhilarating feeling after paying off the first debt. You may be excited enough to try it again in no time.

If you have a car that you are struggling to pay for, you may be tempted to just give it back to the bank that loaned you the money for it. The theory in that case would be that you could return the car to the lending institution and just get a new car in place of it. As lovely as that sounds, it’s not reality. The fact is that having a repossession on your credit can destroy your score and any hope you have of financing something in the near future. I sadly had to do this once after a car accident left me without the ability to work for a few months, so I know firsthand what a repo can do to your credit. Here are some things I found out along the way.

A Voluntary Repo Is Still a Repo

I always thought that by turning in a car on your own, lenders would somehow cut you a break on the new loan. I just figured they would appreciate the honesty and forgive a voluntary repossession. Wrong. Half of the lenders I have tried to work with since my repo don’t even know that it was voluntary, and those that do just don’t seem to care. One of them even thought that I went through two repos because the same car was listed as a standard repo and a voluntary one on my credit. Needless to say a voluntary repo is not considered a forgivable occurrence, even if you did do it on your own.

The Size of the Repo Does Not Matter

You would think that a bank would care about the size of the repo you had when they consider you for financing. They don’t. I had an $889 payment a month on the car I got repossessed, so I assumed trying to get a loan for a $400-ish payment would be no problem at all. The banks can see that I once had fantastic credit because of the previously high payment, so it would be a no brainer for them to loan me a car…right? Again, wrong. I haven’t had a single lender think about the size of my repo when declining me for a car, which is a truly frustrating experience, I must say. One terrible event in my life caused me to lose my income long enough to send back a car I loved, and now I can barely get a bank to look at me for financing.

It Takes a Long Time to Get Past a Repossession

Most of the banks I have tried to talk to since the repo say that they want it to be at least a year old before they consider financing. You can’t just immediately jump into another car after you turn the first one in. You have to wait a long time for it to not have a huge impact on your credit and lending opportunities. In the meantime, you need to do all you can to build your credit back so lenders show you are making a positive effort toward improvement. If they feel that you have made strides towards improving your credit, they may give you a second chance.

How to Avoid a Repossession

The ideal thing for you to do is to avoid a repo in the first place. Reserve part of your network administrator salary to cover your car payment a month, and try to work out a payment plan if you cannot avoid getting behind. You’d be amazed by how willing banks are to help you out if they know it will help them get their money in the end. Work with your bank on a regular basis and you should be able to avoid the terrible situation I have now found myself in.

Medical insurance is far from cheap nowadays, so a lot of college students don’t have it. Assuming you are living on a small budget at the moment, you probably don’t see the need or medical insurance. With that in mind, you may want to realize the negative impacts this lack of insurance could have on your credit over time. If you are trying to keep your credit score as high as possible, you may want to work medical insurance into your budget. Let me explain…

The Risks of Not Having Medical Insurance

Not having medical insurance isn’t going to have a direct impact on your credit, but it can have an indirect impact that you need to keep in mind. Your credit score won’t drop because you don’t sign up for medical insurance. It will, however, drop if you have to seek medical assistance without insurance coverage. If you are in a car accident or suffer from a medical emergency, you need insurance to help you cover the bills. Otherwise you may end up with a ton of medical bills you can’t pay. Those are going to have a negative effect on your credit score in a short period of time.

I was in a car accident about a year ago, and I didn’t have any medical insurance to cover the damage. I had a broken pelvis, fractured clavicle, sprained ankle, and a few other problems that had to be treated. I was actually flown in an emergency helicopter to a hospital in another city for treatment, and I had to stay in the hospital for about a week. After all of that was completed, I had about $70,000 worth of medical bills to my name. Medical insurance could have covered most or all of that if I had had it.

Most people don’t realize just how expensive medical bills are until it is too late. Every doctor, medical assistant and nurse that comes to visit you in the hospital charges a fee. You have to pay that fee, along with the cost of your medications, hospital room, and meals. The most ridiculous charge I saw on one of my bills was for $.17, and that was for a tiny paper cup that the nurses gave me a pill in. All of this adds up over time, and it can all destroy your credit really quickly. That is why you need to consider getting medical insurance.

Options for Affordable Medical Insurance

If you can’t afford a full blown health insurance plan, you may still be able to find some sort of coverage for yourself. Obama recently passed a ruling allowing young adults to maintain medical insurance under their parents up to the age of 36, even if they are married. The up to 26 rule has been around for awhile, but it excluded married individuals. I got married when I was 18, so I was never able to get medical insurance through my parents until now. My coverage becomes effective in January, and I guarantee I will use it. You may try to do the same with your parents.

You can also look into fixed price medical insurance, where the insurance company will offer to pay a fixed price for specific injuries you may sustain. The company will pay X amount of money for a broken arm and Y amount for stitches. You get the idea. This insurance is more affordable than traditional medical insurance, but it does not offer all of the same coverage. If you are fairly healthy though, this may be all you need.

Take a look at your medical insurance options and see what you can get. That will certainly help you protect your credit if an accident comes up in the future.

Credit monitoring programs are designed to give you alerts about your credit whenever there is activity on the credit bureaus. They can tell you when a lender pulls your credit report or when information is reported about a loan. These services could obviously be helpful in protecting you from identity theft, but the question remains about how reliable they actually are. Before you work with a credit monitoring agent, you may want to read on to see if they can or cannot help you watch your credit. Here is an analysis of credit monitoring programs so you can determine if you want to invest in one.

Outdated Monitoring Programs

Some credit monitoring programs are outdated, meaning that they reflect credit activity long after it has happened. The whole point of a monitoring system is to be able to see changes as they happen so you can react to them. If you are not seeing accurate information, you may not be able to respond to an issue until it is too late. Thus it is your responsibility to ensure the monitor you work with is as up to date with the credit bureaus as possible.

I may need to clarify that a little further. Credit, as a whole, is a little outdated. You may pay off a credit card in June that doesn’t show as paid until August. You can’t worry about that when looking for a credit monitoring program. You just need to make sure that your monitoring program is up to date with the bureaus, even if they are behind. I use Identity Guard because they seem fairly up to date with the bureaus, but there are others out there like IG. You can just check out some of your options to figure out what works best for you.

Comprehensive Monitoring Programs

You should always work with credit monitoring programs that look at all three credit bureaus (Equifax, Experian, and TransUnion). Different bureaus look at different pieces of information, which is why your credit scores will vary among the bureaus. You need to see activity from every angle, so it is important to find a credit monitoring service that will look at all of the information possible. That will give you the most protection.

Alerting Monitoring Programs

Reliable credit monitoring programs are going to send you regular alerts that you can react to. If you can’t get an email every time something happens with your credit, you may want to find another monitoring program to help you out. This would be the same theory as having an alarm that didn’t call the cops whenever someone broke into your house. Responding to alarms is one of the police officer requirements that officers know they have to meet. Your alarm should call on them to do that. In this same sense, your credit monitoring should alert you about problems with your credit. You just have to make sure you get something that can actually do that.

Conclusion

Credit monitoring programs are in fact reliable, but only if they cover everything they need to. If you take the time to find a good program that is both up to date and expansive in its monitoring coverage, you will have the best possible chance of seeing benefits from the money you spend on it. There are plenty of credit monitoring programs in the world. You just have to take the time to find the one that is perfect for you. Then you will be able to rely on your monitoring to do everything that it is supposed to do.

In the financial world, you have two main options to getting rid of your debt. You can either go through debt consolidation, or you can go through bankruptcy. Many college students think that bankruptcy is the easy way out because they see all of their debts going away. Poof! Gone. Just like magic. That is far from the case though. While bankruptcy can be beneficial in some debt situations, it can be detrimental in others. If you want to do everything you can to preserve your credit, you need to assess all of your options before determining what to do with your debt. Here is a quick comparison of bankruptcy and debt consolidation so you can determine which one is right for you.

How Bankruptcy Works

In order to understand the pros and cons of bankruptcy, you need to know how the process works. In essence, a bankruptcy lawyer will take a look at all of the debts you have and try to get rid of as many of them as possible. He or she cannot get rid of your student loans if you had to take some out beyond your easy scholarships. He or she will also have a hard time getting rid of your tax debt if it has not been at least three years since the taxes were filed. Most of everything else can be wiped clean, but note that you will likely have debt coming out of this process. The only thing that will change is the amount of debt you have.

Bankruptcy literally destroys your credit, and it will remain on your credit report for seven to ten years. That is a long time to have to live with one mistake from your past, which is why it is sometimes better for you to consolidate your debts if you can. That way you have the opportunity to rebuild your credit without the huge red flag of bankruptcy weighing down on you. If you have a second car or house, you will be required to give that up during the bankruptcy. Those will be used as assets to pay off some of the debt you are getting rid of. See? It’s not all fun and games with this solution.

How Debt Consolidation Works

If you are considering debt consolidation instead, you may still have some stress ahead of you. With debt consolidation, you basically combine all of your debts into one big loan that you can pay off over a longer period of time. The goal with this is to get your debts down to a reasonable payment every month. You may get to experience a lower interest rate or a longer loan term than the ones you have now, or you may even have some of the debt collectors settling for lower amounts. Some money to them is better than no money. If you decide to do this n your own, you may struggle to get the help you need. If you speak to a professional consolidator though, he or she could reduce your debts tremendously. You just have to worry about paying him or her a fee for the help.

Choosing the Option that Works for You

It is hard to say what the ideal solution is going to be for you because your credit situation is not going to be the same as anyone else’s. Think about the money you make and the debts you currently have, If you could logically pay your debts off in the near future, then do so. You will improve your credit along the way. If there is no hope of that though, wipe the slate clean and start fresh. You can focus on rebuilding your credit from there.

Financing a car is a big part of building your credit. It does not matter how old you are or how much money you make a year. You will eventually come across a car you want without having the money upfront to pay for it. When that happens, you can potentially get a loan from a bank to pay off the balance of the car. When you pay back the loan and the interest on it, you get to be the owner of the car. The process is that simple. Before you get wound up in a bad deal though, you may want to do a little research about auto financing. Here is a “crash” course in car financing that you can use to drive off with a good deal.

Know the Value of Your Car

Before you buy or finance a car, you need to know what the car’s value is. You can use NADA Guides or Kelley Blue Book to find out a car’s current value based on its year, make, model, condition, and options. Banks will usually only lend out a certain percentage of the good or excellent trade-in value for a car, so you need to find something that is priced below retail. If not, you may need a high down payment to make up the difference. If the car is priced hundreds of dollars above the retail value though, you just need to move on to another deal.

Ask before You Apply

Some people are tempted to fill out car applications all over the place. What could that hurt, right? Believe it or not, that kind of haphazard applying could hurt your credit over time. Every set of credit apps you send out reduces your score a bit, and it sends red flags to future lenders because you look desperate for financing. Rather than going through all of that, you need to speak with someone in the dealership’s finance department before you fill out an application. Tell him or her about your credit and financial situation to see if he or she even has a lender that would work with you. If there seems to be hope about that, you can proceed to filling out an application.

Beware of Buy Here Pay Here Dealers

A lot of college students get wrapped up in the idea of buy here pay here dealerships because they offer low priced cars and guaranteed financing. The problem is that the cars at these dealerships are almost always lemons. They may look good and run well initially, but eventually you will come up with problem after problem. The cars are usually priced well above market value when you factor in the financing charges, and they come with interest rates that are nearly impossible to pay off. On top of all that, you may not see a single positive mark on your credit after working with a dealer like this. Check out my blog post titled The Truth about Buy Here Pay Here Dealers to learn more about the terrors that come with these tricksters.

Additional Information

If you want to know more about financing a car while in college, you can check out my college car finance blog. This topic was broad enough for me to devote a whole site to it, if that shows you how important it is for you to learn about auto financing. Whether you’re a criminal justice student, a pastry chef, or anything in between, you can get a car you love. Anyone can get financed for a car – even you. You just need to find the right car, the right lender, and the right loan altogether. If you stay dedicated and persistent, you will eventually find a deal that is perfect for you.

If you’re just now starting your forensic psychology degree or other degree program, the thought of establishing credit for yourself may not be that prominent in your mind. Most college students have no idea how important credit is until it is too late for them to establish it. Hopefully this article will help you see the importance of good credit before you need to use it.

Credit Is Everywhere

You have to go through a credit check for just about everything nowadays. I’ve had one for my rent, all of my utilities, my car, my security system, my credit cards, and even my internet. If you don’t have good credit, you’re going to have to pay a lot of money in deposits to get everything you need in life. A lot of other countries don’t hold credit very highly, but we do here in America. You just need to do what you can to get your credit off to a good start. It will impact just about everything you do in life.

What Credit Represents

The reason why credit is so significant nowadays is because it represents a person’s ability to pay back loans. In most other countries, you have to first save money before you buy much of anything. Here, we give you the chance to get a loan for what you want to buy as long as you can prove that you can pay it back later. If you can show that you are trustworthy with making a loan payment, you will have a much better chance of getting financing in the future. When it comes right down to it, your credit represents your character as a person.

Establishing Good Credit

Establishing good credit is not always easy because you basically need credit to build credit. You can start with a simple credit card or payday loan that does not require a lot of credit to get. You could also lease some sort of furniture from Aaron’s or Rent-A-Center, and they will report your positive payments to the credit bureau. In doing that, you will slowly improve your credit score and enhance your credit history. You just have to make sure you keep up with your payments as scheduled.

If you cannot get financed for anything on your own, you can see if a cosigner would help you establish credit. With a cosigner, the creditor or lender you work with has someone to get money from in the event that you don’t make your payments. Your cosigner is going to be putting his or her credit on the line for you, so you need to make sure you keep up with the payments on the account. Otherwise you could destroy your credit and your cosigner’s credit at the same time. You may have trouble finding a suitable cosigner that is willing to work with you. Explore as many avenues as you can before you just decide to give up.

Conclusion

Credit becomes more important the more you want to buy. When you apply for loans on cars, houses, boats, and other big ticket items, you need more credit to prove that you can be trusted with the payments on them. By building a solid foundation for your credit now, you will be much better off in the future. Lenders like to see long credit histories, so you will greatly benefit from keeping a line of credit for an extended period of time. Focus on paying your bills on time, and you should be able to let the importance of good credit work in your favor.

Payday loans are small sources of money that you can get in between pay checks. These loans are pretty easy to access, but they may not be as great as you think they are. There are a lot of down sides to payday loans that you need to keep in mind before you sign up for one. The more you know about what you’re getting yourself into, the better decision you can make about your financial future. The analysis below should give you all the information you need ton know if a payday loan is right for you.

Getting Payday Loans

Getting a payday loan is pretty easy. Most lenders that give out installment loans like this will not require you to have good credit to get money. All they want to see is that you have a steady source of income that exceeds your current bills. The loan company will look over your pay stubs, bank statements, or other proof of income to determine how much money they can give you. Then they will go over the terms of your loan so you can sign the papers for it. If you agree to everything, you can get the cash you need right away.

How Payday Loans Impact Credit

Some people say that payday loans help your credit, and others say that these loans will hurt you in the long run. In theory, having a loan that you are making good payments to will improve your credit scores, but getting multiple payday loans may send out red flags to future lenders. They will see that and wonder why you cannot last without all of those small loans. You have to think about the whole picture before you sign a contract for a payday loan because it may make a bigger dent than you think.

Paying Back Payday Loans

Payday loans come with incredibly high interest rates, so be prepared to pay a lot of extra money for this quick cash. These loans are almost as bad as pawn shop loans in terms of the interest you have to pay, so be careful before you get a loan you may not be able to repay. The lender will outline all of your monthly payments, but those may not reflect the total that you pay. You may end up shelling out several hundred dollars in extra fees just to cover interest. You can avoid that by not getting a loan in the first place.

How Much Can You Get?

The amount of money you get for a loan will likely be $200 to $500 at first. If you repay that loan amount with the company, they could extend up to $1,200 to you the next time you get a loan. That all depends on the amount of money you make and how quickly you paid back the first loan. You will get more on an administrative assistant salary than you will with minimum wage pay checks. Every lender is going to be a little different, so just look around to see which place in your area can offer the best deal for you.

Are Payday Loans Good or Bad?

Payday loans are good in the sense that they give you fast cash, but they are bad in almost every other aspect. They cost a lot of money to pay back, and the usually make a negative impact on your future lending abilities. You may be better off putting your debts on a low interest credit card that you would be getting a payday loan. That is up to you in the end. Hopefully the info above will at least help you make a smart decision the next time you are in a financial bind.

Identity theft is a huge problem in America, and it can happen to just about anyone. The Federal Tax Commission estimates that close to 10 million people go through identity theft every year, and many of them incur costs of $5,000 or more as a result. In some cases, the identity theft can actually cause a person to file bankruptcy because the charges they have to pay get so high. Before something like that happens to you, you may want to look into credit monitoring services.

Does Credit Monitoring Prevent Identity Theft?

Credit monitoring will not prevent identity theft altogether. It is possible that you will be the victim of identity theft if the wrong person gets a hold of your personal information. With that in mind, credit monitoring programs can help you catch identity theft early on so you can correct the problem before it spreads too far. Roughly two thirds of identity theft victims a year do not incur any financial losses at all as a result of their identity theft, and most of that is due to them catching the problem as it developed. With the right credit monitoring program, you could do the same.

Cost vs. Benefits

Some people worry about the cost of credit monitoring, as most programs have a small monthly fee to pay. You don’t need to make an FBI job salary to pay for monitoring, but you may still find it to be an unnecessary bill. While you don’t “have” to get credit monitoring, it can save you a ton of money later on. Let’s assume you spend $15 a month for your credit monitoring. That means that you will spend $180 a year. It only takes a few days for someone to rack up thousands of dollars in debt that you may have to pay back, so the money that you spend every month will provide you with highly necessary protection. For less than the cost of an average trip to the movies, you could protect your finances and identity at the same time. Any investor would say that is money well spent.

What to Watch with Credit Monitoring

Identity theft is a common problem that is easiest to stop when it is noticed early on. Credit monitoring companies offer fantastic tools to help you see when someone else may be using your identity. Here are a few ways monitoring your credit could help you stop identity theft before it gets out of control.

Financing Applications

If someone tries to use your information to get a loan of any kind, it will show up on your credit report. This is known as a “credit pull,” which puts a mark on your credit report saying that a certain lender looked at your credit at a certain time. If someone does this without your authorization, you can contact them to determine if someone else has been using your identity. Then you may be able to stop the person from getting the money they wanted from the identity theft.

Debt Levels

Credit reports will not reflect the day to day balance of a line of credit, but they will offer monthly summaries for you to view. If you have a credit card out that shows a much higher balance than you have expected, you may be able to contact the creditor to report possible identity theft. That creditor will then review your recent expenses to determine if you were in fact a victim of identity theft.

Credit Alerts

You can use the alerts from a credit monitoring service to help you keep track of what is going on with your credit and identity at all times. Note that some credit reports will not reflect information for at least a month after it happens, so you should still go about your own monitoring to keep yourself fully protected. This can provide you with extra security when you need it most.

Conclusion

All you have to do is find a good credit monitoring program to get the peace of mind you need about your credit. The world is run on credit nowadays, and a monitoring program will make sure you know when something happens that might hurt yours. With up to date alerts and credit protection tips every month, you can be on your way to a secure future for your credit history. You just need to take the first step.

Identity theft is not always preventable, but it is something that should be taken care of right away if you suspect that someone has stolen your identity. If you think you are the victim of identity theft, there are a few steps you should take to ensure that you suffer the minimum amount of damage possible from the issue. Here are a few things you might want to do when that time comes.

Cancel All Credit Cards

After the first sign of identity theft, you need to cancel all of your credit cards and report the potential theft to your creditors. They can issue you new cards for the same accounts, so the only thing that will change is the card number. If someone else has your credit card or the information from it, they will not be able to use the card once you cancel it.

Change Your Bank Account

Most banks will allow you to change your bank account number at no charge to you. You should do this after a possible identity theft so your money is protected. You could also change banks entirely or withdraw all your money to keep the cash. Just do whatever it takes to prevent someone else from accessing your money.

Watch Your Credit Report

It is possible for someone to use your identity to get a new loan, so watch your credit for signs of activity that you have not authorized. If there is something that looks suspicious, you can contact the lender on your credit report to complain about identity theft. Whether you’re living on Ramen Noodles or you have a administrative assistant salary to rely on, you have to do something to make sure that your money and personal information are safe at all times.

How Often Should You Go through Credit Monitoring?

Obviously, better credit monitoring means better protection. Thus if you have someone working on a regular basis to monitor your credit, you will have a better chance at catching problems before they get out of hand. The only problem that comes with this is that you will have to pay money for a service like this. The fees will not be high and they will be worth the investment in the end, but they still need to be taken into consideration.

You have the opportunity to get one free credit report from each bureau a year. You could use that as your sole source of credit monitoring. This may mean that you do not catch a problem until months after it has developed, but at least you would be able to see it without having to pay any money. You are basically taking a gamble with your credit at that point, hoping that a serious problem doesn’t come up along the way.

Credit monitoring is no guarantee that you will be protected from identity theft, but it can provide you with peace of mind knowing that you are doing all you can to protect yourself. As long as you can find a reliable credit monitoring system for a low price, you should see benefits from this service in the end. Take a look at your options and see what you can find.

Conclusion

You are responsible for keeping your identity safe. While there are protocols with most creditors, stores, and lenders nowadays to protect you from this growing problem, you could still be a victim of identity theft without warning. Try to reverse the problem at the first signs of it, and you will be much better off in the end.