Financial Tips for Success

Credit Score???... 

Advice to follow as a compass in your financial decisions

We are bombarded every day with all those temptation to spent money, to a point where you will even have the hardest time to convince yourself that you don't even need what you are about to buy, our minds are clouded by all the "SALE" and "Discounts" signs. So, you need a strong financial discipline, which will help building and keeping a good Credit Score, or ruin it all and spend that money, put it a saving account, now you can do it on the spot from your smartphone with your bank app, it will feel like a transaction but it remains in your account, or another great idea, donate some of it to charity or a homeless on the street, it's an amazing feeling, try it!
Only spent your hard earned money on what you need and what make sense. Remember, if you can't say "NO" each time you want to buy something you don't need, you will run out of money and then you start applying for credit cards which eventually won't be able to keep up with payment and that will resulting in ruining your Credit Score.
Every time you are tempted, think about how hard and how long it took you to earn that money, so if you cave in, it's like an insult to you because you don't value yourself and the hard work and effort it took you to earn it.
 

Investments that will help you build a good Credit Score

When it comes to buying a car, getting a brand new one is not always a wise financial decision because a car's depreciate  fast, even as soon as you take it out of the dealership. So, considering buying a car is not a small investment, try to do your research for a certified used car, it will save you thousands of dollars. Big purchases with affordable monthly payments are a great way to improve your Credit Score.
Trim your monthly expenses, I bet you if you sit down to write down a detailed breakdown of your monthly bills, you'll find some of them that are just a waste of money but you were thinking that you need those services, like cable, you might be paying for extra channels that you probably don't even watch because of your lifestyle and constant lack of time, you need to cancel those extra channels and lower your cable bill.  

Don't let debt ruin your life

Deal and face any current or old debts you may still have and now you have debts collection agencies (Biggest threat to your Credit Score) harassing you and this will get you all stressed out, and you know this will affect you in big negative way, so try to call them to see what you can do to get over with it, but, keep in mind, remember that when a collection agency calls you to discuss a debt, remember that you do not have a written contract between you and the agency, the actual financial contract was between you and your credit card or loan institution, so when you speak with the agency, ask them to provide you documents that proof that they are eligible to collect any money from you, in some cases, the debt could be old and you are no longer liable for it, so know you credit history.

Practice good judgment in your finances

Follow these tips as approaches to keep your money all together in check, and gradually you'll begin to see your money related circumstance improving and your Credit Score soaring high. When you have your hard earned money under control, you'll see that your life begins to enhance too. Make a money related arrangement, stick to it, and watch how your life starts to develop in a crisp and new manner, and the opportunities and access to money resources you couldn't before because of a low Credit Score.

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Credit Score, How to improve Credit Score?, increase credit score, Secure credit card to build Credit score, Myths about credit score, what is Credit Score, why is my credit score low, help with credit score, Credit score bureau. 

Bank Overdraft Fee

Bank overdraft fee is an option that banks offer to their new or existing customers and would love if you opt in for it. The way it works is, if chosen, if you run out of funds and you need to use your bank card for a purchase, you can do it and the bank/financial institution will cover the transaction,  sure it sounds good, right? may be! but you will be charged a fee ($32 to $36) depending on your bank, so you could be somewhere an need to by something for $10, this will end up costing you up to $46 because you didn't have the money in your account but the bank authorized it anyway.

I personally hate this feature, I had issues with my previous bank because of the sneaky way they apply it. The problem is the delay in the transactions posting time. I was misled between my current balance and available balance, thinking that my available balance reflected the actual amount I have available after making a deposit. The will do all their best to make you fall for it, so my advice to you is to always decline the overdraft fee option, it might save you a momentary embarrassment by not having your card declined but it will cost you more money, and the worst is when you have many transactions posting at the time against a smaller balance causing you to go overdrawn and that may happen several times. So remember, Big NO to overdraft fee.

A path to increasing your credit score

First of all, ALWAYS keep in mind that when you get a credit card, the money that you have access to, 

IS NOT YOURS, always treat it that way, or else, you will become financially irresponsible and that will cost a lot on a long term.

Here are few factors or rules  you MUST go by if you want to keep your credit History/Score in good shape, or if you have gone through some finance hardship like most of us have, this will still work to turn things around for the better.

One: Payment on time:

Your credit score could get a serious hit if you are late to pay your balance dues. 

On time payment shows creditors that your are a good borrower who respects their trust in you. 

Two: Credit Utilization Ratio

Let's say your credit limit on a card is $1000, make sure that your balance every month after you make payments is always between 10% to 25% of your credit limit ($100 to $250). Of course, the creditors do not want you to pay your balance in full, they like you to keep a balance on your account so they can charge you some interests.

This will show creditors that you are a responsible borrower who will not start drowning in debts.

Three: Request credit limit increase after 6 months of accounts' opening            date

Most creditors review their borrower's credit history for evaluation every 6 months, so you keep your accounts in good shape with timely payments and small monthly credit balance, you can call your creditor and ask for a credit limit increase, what this will do if approved, is to decrease your credit utilization ratio:

Example: your credit limit was $1000 for the past six months and you always carried a monthly balance of 25% ($250), now you get approved for another $1000 dollars increase bringing your available credit limit to $2000, now the 25% of the $1000 becomes only 12.5%, your score will improve by tens of points.

Please note that this rule could be applied to the combination of your total credit cards limit vs your combined balances on all your credit cards. 

Four: keep an eye on your credit report

This way you can stay up to date with all your credit history activities, so if there is any suspicious activities, like accounts that you are not familiar with or any errors that may have been reported by creditors or collection agencies.

Five: Always negotiate for lower interest rates

Once you establish an OK credit score of 685 and above, call your creditors and negotiate the interest rate on the cards, lowering rates means that your credit line will cost you less and eventually, it will not cripple you with extra charges added to your balance. 

Six: Do NOT close your credit cards

You might think that closing credit card accounts will help you because it will lower your borrowing amount, MISTAKE, the credit bureau will count this action against you and lower your score. One of the factors that the system calculates your score is the credit history age, the longer you hold an credit account open and in good standing of course, the more positive impact it will have on your credit score.

If you follow these tips, in 6 to 12 months you'll have good credit score and it will keep getting better till it allows you to tackle bigger loan like buying a house.