The Secret to Saving More Money
Do you want to know the secret to saving more money?
A good tactical move to saving more money is to make sure you work on raising your credit score.
A higher credit score is the secret weapon that allows you to save money by giving you more leverage and negotiating power when applying for new loans.
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Usually, the higher your credit score, also known as your FICO score, the lower the interest rate you’re offered.
With a higher credit score, you have more bargaining power when renting or purchasing a new home.
Your Secret Weapon to Saving More Money
Higher credit scores can allow you to save money by not needing a security deposit on cell phones and utilities or a minimum security deposit.
Get a Copy of Your Free Credit Report
The three main credit bureaus are Equifax, Experian, and TransUnion.
Each credit agency offers you a free copy of your credit report every 12 months.
Get a free copy of each of the three credit bureaus’ annual credit reports so that you know where you stand.
It is a common fact that mistakes may be listed on your credit report.
Check each credit report and fix any discrepancies you may find.
After you dispute any errors, get another copy of your credit report to ensure the error has been removed.
Using your credit cards (and paying them off) is a great way to build a credit history if you don’t already have one.
You should just watch your spending ratio on the card by maintaining a ‘credit utilization ratio’ that’s less than 30% of the card’s spending limit.
For instance, if your card’s credit limit is $1,000, 30% of that is $300.
So, work on not having a balance over the ratio of $300 on that card.
Find more on the credit utilization ratios here.
Be aware of when your credit card company submits your balance to the credit bureaus.
Give them a call if you’re unsure.
Why? Let’s say they report balances on the 5th of the month, but you pay in full on the 6th.
Your credit report will still reflect that you are carrying that balance, although you’ve paid it off.
Another way to raise your credit score (and a great financial practice) is to pay off your credit card balances monthly.
Paying off your credit card balances monthly helps to keep your overall credit balance ratio lower and increases your credit score.
Have patience when working to increase your credit score.
It can be a slow and steady process.
Your credit score will rise with continual consistency in paying your bills on time, watching your credit card ratios, and checking your credit report for discrepancies.
What tactics have you used to raise your credit score?
Please share it with us in the comment section below.
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