Credit and how to make yours Lit..
Now that I understand the importance of credit, I take it super serious. I get constant updates from Experian on if anything has changed. I'm always watching it like a hawk. I was never taught how to maintain my credit or finances (I didn't grow up in the best situation) because our focus was mainly on survival. But as an adult, I've learned a few little tricks on keeping your credit great or even raising it that I'd like to pass on.
When I was in college I met this girl who I became friends with. One day, I rented a car under my name and let her drive it. BIG MISTAKE. Don't ever do this. Anyhoo, long story short, she totaled the vehicle and disappeared on my ass. So, in addition to an unpaid phone bill and Old Navy credit card, this is what started the demise of my credit.
I would say one of the most important things about credit is actually looking into what is associated with your name. When I finally started needing to focus on my credit, I found a few things that were not accurate. Its important to not just accept the score, but really look into what's on there and dispute what's inaccurate. You can do this one time or monthly with Experian. Its only 24.99 a month and COMPLETELY WORTH IT.
I'm sure you've heard many theories on how to raise a credit score. Whether its having to do with using or not using credit cards. But here's what worked for me. When I first started "growing up", I couldn't get a credit card to save my life. I kept getting denied because my score was so low. I had to go through my bank for my first credit card. It took me 3 times to get approved for a $500 limit. So I tried three routes on getting my score up to par.
First, I tried not using the card. I locked it away and never touched it. But after a few months, my limit didn't increase and neither did my credit score. Next, I tried using it and paying it off immediately after I used it. For example, if I bought dinner on the card, I would transfer money over immediately to pay it off. Unfortunately, this didn't work either.
The only route that worked for me was spending half of my limit ($250) and paying it off automatically at the same time each month when the card was due. This is what increased my limit and started increasing my score. I believe I was about 580 and now Im at a 800 credit score. I find that increasing your score is all about trust. There's an art to it. You have to look like you are trustworthy on paying the money back and also like you don't really need the card. If you spend up to your limit, it looks like you really need that card and you don't have a lot of money. This doesn't make them want to increase your limit.
Also, when you pay the card off immediately, where's the trust there? You didn't even let it sit long enough. With most credit cards, there are due dates. I set up mine to pay automatically on this due date so its nothing I ever had to worry about.
Lastly, with credit cards, remember to spend only what you have. If you can't afford it, don't put it on that card! Only spend what you can immediately pay off so its never stressful :)
Feel free to ask me anything or put in some of your tricks on increasing your score.
Thanks for reading