The Women’s Guide to Credit & Finances 2017-11-09T11:42:37+00:00

The Women’s Guide to Credit & Finances

cre-whitepaper-cover The Women’s Guide to Credit & Finances

Creating Financial Empowerment for Your Family

Table of Contents
Introduction

  1. UNDERSTANDING THE BASICS OF CREDIT
    • Credit Score 101
      • Types of Credit Scores
      • Good or Bad Credit Score?
      • Improve Your Credit Score
    • Inquiries
    • Your Credit Report, Monitoring & Inaccuracies
      • What Exactly Does My Credit History Include?
      • Monitoring Your Credit & Identifying Inaccuracies
  2. BAD CREDIT CAN COST YOU
    • Home Financing
    • Interest Rates
    • Insurance Rates
    • Investments
    • Starting Businesses
  3. CREDIT CARDS
    • How Credit Cards are Beneficial
      • Build Your Credit
      • Fraud Protection
      • Emergency Funds
      • Rewards
      • Car Rentals
    • Credit Card Pitfalls
      • Getting Wrangled by Interest Rates
      • Unexpected Fees & High-Cost Fees
      • Monitoring and Tracking
      • Ways to Avoid Credit Card Pitfalls
    • Credit Cards: How They Affect Your Credit
      • Credit Card Debt
      • Opening & Closing Credit Cards
    • Debt-to-Income Ratio
  4. THE MISGUIDED AMERICAN CULTURE
  5. ROLE IN FINANCE: GOVERNMENT AND CORPORATIONS
    • Errors on Credit Reports
  6. STEPS TO FINANCIAL SUCCESS
    • Your Financial Game Plan
    • Communicate Your Plan
  7. DIVORCE AND CREDIT
    • Credit and Relationships
      • Communicate & Plan
  8. BANKRUPTCY & CREDIT
    • How Filing for Bankruptcy Affects Your Credit
    • Bankruptcy and Your Credit Report
    • Chapter 13 vs. Chapter 7 Bankruptcy
  9. IMPORTANCE OF CREDIT MONITORING AND GETTING HELP
    • Five Benefits of Credit Monitoring
    • Monitor Credit to Repair It
  10. BUDGETING & RETIREMENT
    • Costs to Include in Retirement Budget
  11. WAYS TO SUPPORT YOUR FAMILY FINANCIALLY AND EMOTIONALLY
    • Providing Financial Support
  12. CONCLUSION

INTRODUCTION

The 1960s were pivotal to women and their financial independence. Equal pay for equal work and affirmative action benefits for women opened the door for the Equal Credit Opportunity Act (ECOA) in 1974. Before the ECOA went into effect, women were met with resistance when attempting to establish credit in their own names. Fast forward into the 21st century where women have access to acquire, build and grow their credit. Even more empowering is that 57% of credit union CEOs overall are women, taking over the industry as they exercise their right for financial independence. Regardless of their rising success in the workforce and escalating income, it seems that American women still have major gaps and unmet needs with it comes to achieving comfort and confidence with money.

We want to continue to challenge the status quo and push creative solutions to educate women like you on gaining their credit independence. Become a financial guru by learning the basics of credit, the consequences of good vs. bad credit and how to manage credit for a successful career and lifestyle. We also provide tips on budgeting, saving for retirement, supporting your family and how to steer away from the pitfalls of keeping up with the Jones’s.

1. UNDERSTANDING THE BASICS OF CREDIT

In an era where lenders are leveraging credit scores to size up a potential customer over personal bias and experience, it’s important to achieve and manage a credit score that’s reflective of your financial savviness. Over 90% of women believe they need to be more involved in financial strategies, and being strategic and financially savvy starts with knowing the basics. There’s a lot of information floating around about credit inquiries and consumer reports to credit score monitoring, so let’s round them all up into a concise understanding about the basics of credit.

Credit Score 101
Your credit score is a report of how good you are at repaying debt. This score lets lenders know whether they should let you borrow money from them and if they can trust that you will pay them back in full and on time. There are four areas of influence that affect your credit score:

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Types of Credit Scores
There are different credit score modelers for different companies. All you need to worry about is the generic credit score, which indicates general financial risk. But it’s good to know that a company can request a custom score, which is created to help predict risk for a specific lending situation (i.e. retail debt, car loan repayment or bankruptcy risk). Your history is used to create every credit score though so if your risk is generally low, it will most likely be low across the board.

Good or Bad Credit Score?
It depends. What it depends on is the type of credit score being pulled but the foundation remains the same; the higher the score, the lower the risk. A good credit score ranges between 661 and 780 while an excellent credit score ranges from 781 – 850. A good FICO score (another way to calculate your credit score) lands somewhere between 690 – 719 and an excellent one is 720 and up.

Improve Your Credit Score
To improve your credit score, you need to improve your credit report. Although you can’t take back history, you can address the information in your report that affects your score the most. For example, you can pay a past-due payment and paying each payment on time after that will prove that you engage in financially sound practices and credit management. Don’t expect immediate results. Your credit score will improve over time as long as your maintain good behavior. Read about your credit report to get an idea of what bankers see so you can improve on those areas.

Inquiries
So you’re ready to buy a new car, congratulations! If you plan on financing a bit of your car payment then the dealership or lender is going to inquire about your credit score. Because people shop for the best rates when making a home or auto purchase, credit scoring systems count inquiries that occur with a short period of time as only one inquiry for those reasons. Recent credit inquiries, however, concern creditors because they may indicate you have added debt they don’t know about yet. That’s why you are often asked to explain recent credit inquiries when you apply for a mortgage. The older the inquiry, the less important it is.

Your Credit Report, Monitoring & Inaccuracies
Credit scoring models are used to compare the information in your credit report with your track record to determine your risk level. With that in mind, it’s best to know what’s actually on your credit report. After an in-depth look at a credit report, you’ll see that it provides a good overview of the type of information obtained by a credit reporting bureau. Credit reports include: personal data, credit history, account details, inquiries, collections and dispute issues.

What exactly does my credit history include?

  • Number of accounts (open and closed)
  • Type of accounts
  • Number of credit inquiries over a 12-month period
  • Number of past-due accounts
  • Accounts in good standing
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Monitoring Your Credit & Identifying Inaccuracies
Now that you know what goes into a credit report, be sure to regularly monitor it. Why? A large percent of credit reports contain inaccuracies which can negatively impact your credit score. You may catch some discrepancies or new accounts that you didn’t open (fraud!). Credit inaccuracies can result from fraud or just an oversight from a lender. When you spot an error on your credit report you can take steps to dispute it:

  1. Obtain your credit report
  2. Find what needs to be removed (FYI you can’t get rid of negative notes):
    • Wrong information
    • Duplicate information
  3. Dispute inaccuracies
    • File the dispute with the bureau
    • Wait 30-45 days

No change? Inaccuracy still there? Write a letter to the creditor explaining why the information is inaccurate and why you’d like them to report the correct information. Be sure to supply it with supporting documents that aid your case.

This can be a tedious process and there are many different ways to go about investigating the creditors and credit reporting agencies. There are a few companies out there that you can hire that are very good and assisting consumers through this process. Our company CRE Credit Services is one of them and we offer a free consultation on your credit report.

2. BAD CREDIT CAN COST YOU

There are many side effects to bad credit, but worst of all it can affect you mentally, emotionally and personally. It can limit your lifestyle in many different ways. A bad credit can hold you back from securing a mortgage to buy your first home and if you do get a loan, your interest rate can be up to 100% higher than it would be had you had excellent credit.

Instead of digging yourself a deeper hole, consider ways to clean up your credit act because a bad credit report can cost you in many ways. Bad credit can cost you a small fortune over the course of your lifetime. Let’s look at a few areas where this can occur.

Home Financing
Let’s go back to our first example. If you want to buy a home, you will most likely need to take out a mortgage. If you want to buy a home with bad credit, you might only be able to secure a loan that charges 9-10% interest, making for much higher monthly payments. This can cost you thousands of dollars in the long run meaning you’re paying back FAR more than you borrowed. A good credit score can help you secure a lower interest rate at around 5% or less. Emerging new borrowing options may be able to help you get financing with lower credit scores at much lower rates than the 9-10%, however they will still be higher than if you had good credit. Most people don’t realize that 1% difference in interest on a 30-year mortgage is equivalent to paying 25% more of the total amount financed in interest. For example, on a house that you finance 200k you would pay and extra 50k in interest for every 1% difference in interest rate. That’s how important interest rates are.

Interest Rates
Speaking of interest rates, have you noticed a trend? If you have a low credit score, banks are going to hit you with a high interest rate whereas a person with excellent credit, is going to enjoy the benefits of low interest and overall lower monthly payments.

Maybe you were in between jobs and missed a few payments. The unfortunate side of it is that your credit score doesn’t care about your situation, and neither do interest rates. In fact, the average interest rate for someone with average credit is 5-6%. Interest rates can vary from 6.5% to 12.9% for someone with bad credit. The bottom line: the lower your credit score, the higher your interest rates.

Insurance Rates
The same concept for interest rates can be applied to insurance rates as well. For the past 20 years, insurance companies have been using your credit history to decide whether or not to offer you an auto or homeowners insurance policy, which of their policies they will make available to you and how much they will charge you. With some insurance companies, a consumer with the worst credit score – everything else equal – can pay two, three or four times as much as a consumer with best credit score.

With car insurance rates for example, esurance maintains that credit-based insurance scores don’t factor in your job, income history, gender, or any other personal information. Car insurance companies use them to help determine the likelihood of an insurance claim in the future.

Favorable factors that influence your credit-based insurance score:

  • Long-established credit history
  • No late payments or past-due accounts
  • Open accounts in good standing

Unfavorable factors that influence your credit-based insurance score:

  • Past-due payment
  • Accounts in collection
  • A high amount of debt
  • A short credit history
  • A high number of credit inquiries

Investments
You’re passionate about houses and want to get into real estate investing, but you have poor credit. Typically, lenders require a better credit profile for real estate investors than for consumers who are buying a home as their primary residence. Why? Say a bank loans you money to buy a house for you and your family. If you get into some troubling financial times, you’re more likely to scrounge up what money you have to keep your home rather than to pay for your investment property. Banks see this from a psychological point of view.

Now, if you want to invest in real estate, keep in mind that a mortgage lender typically requires a strong credit score of 720 or higher for a loan to buy investment property. In addition, you’ll need a down payment of 20 percent or 25 percent or more and the income to handle the mortgage for several months along with your own rent or mortgage.

Starting Businesses
In a recent report, over 63% of business owners attempting to find funding say they most often targeted banks. Unfortunately, the success among these respondents of actually getting a business loan was a low 27%.

Many entrepreneurs do not have good credit and unfortunately, banks focus purely on credit history in making lending decisions to small-business applicants. Consolidation in the banking industry has driven banks to automate their credit decision processes and minimize the labor involved in getting to know credit applicants face to face.

So if you have bad credit, the good news is it’s not a permanent financial state. You don’t have to be stuck in this rut forever. With some simple and positive changes, you can adopt new habits to improve your credit score and way of life. Be sure to monitor your credit and check your credit score at least three times a year.

3. CREDIT CARDS

Credit and debit card transactions surpassed more than 50% of all non-cash transactions by 2006, up from 42% in 2003, according to a tri-annual study by the Federal Reserve. In some ways, credit cards offer peace of mind and security; you can buy what you need when you need it without carrying around stacks of cash. What most people fail to think about with each purchase is that technically, you’re using borrowed money whenever you swipe your credit card, which is why we suggest only spending money you do have. Don’t use your credit card to make a purchase you cannot afford. In the end, if you don’t pay your card balance in full each month, you’ll pay interest on that loan. Let’s take a look at the pros and cons of credit cards

How Credit Cards are Beneficial
Build Your Credit
If you made it to this section, then you’re pretty well-versed on credit scores. One of the biggest reasons to own a credit card is to build your credit history which affects your credit score. The key to establishing a credit score and achieving an excellent one is to charge small amounts and pay them off.

Fraud Protection
Since its borrowed money, if someone uses it without you knowing then you’re most likely protected. It’s not money coming out of your savings or cash accounts, so the bank can quickly close your account, issue you a new card and you won’t be in the dark fighting to get your hard-earned money back.

Emergency Funds
Although you should build up a savings amount for emergencies, credit cards can be a good fall back when you’re really strapped. But we mean really strapped because one emergency can turn into 10 and you’ll quickly dig yourself into a deeper hole.

Rewards
Cash back for spending? Sign me up! When used properly, you can reap the rewards and if you get cash back, you can use that money to pay off your card!

Car Rentals
Most people don’t think of this but most car rental companies may not rent you a car without a credit card. If you use your debit card, you’re locking up a lot of your own money until you return the car. Some credit cards also provide additional liability insurance when you rent a car.

Credit Card Pitfalls
As we said earlier, never spend money you don’t have. Before jumping head first into signing up for a credit card, assess your needs and if you are able to handle the responsibility of having access to borrowed money. Be sure to avoid these pitfalls:

Getting Wrangled by Interest Rates
The annual percentage rate (APR) is what you pay if you carry a balance on the purchases you make, which is why we advise spending a little and paying it off as soon as possible. If you have trouble maintaining a budget or keeping your spending in line, you may not be ready for a credit card.
Instead of rolling over a balance and accruing interest rate payments, use your card wisely and pay it off every month.

Unexpected Fees & High-cost Fees
Before even signing up for a card, read the fine print on fees. When you default on credit card payments for example, you will be hit with late fees and interest, increase your debt and negatively affect your credit score. Acquiring too much credit card debt can ruin your credit score.

Monitoring and Tracking
Since credit card fraud is a real thing and you’re spending borrowed money, its best practice to check your receipts against your statement every month. This will also help you determine if you’re being overcharged. So the downfall here? Paperwork and time spent checking and rechecking.

Ways to Avoid Credit Card Pitfalls

  1. Keep track of your purchases.
  2. Make and keep tabs on your budget (avoid overspending).
  3. Pay off credit card balances each month (this is easy if you spend less than you can afford).
  4. Be cautious with online purchases.
  5. Report stolen cards or fraudulent activity immediately.

Credit Cards: How They Affect Your Credit
Just owning a credit card won’t affect your credit, it’s how much of your credit line you’ve used, how much you owe and how often you make your payments that matters. Bottom line: The higher your credit card utilization, the lower your credit score. For example, if you are constantly charging all of your money, hitting or going over your credit limit, you are far more likely to have difficulty repaying that money than someone who uses their credit cards sparingly.

Credit Card Debt
The best rule to follow is the credit-to-debt ratio which suggests that you should never utilize more than 30% of your total available credit on any one credit card. Once your credit utilization goes above 30%, then your credit score will likely begin to drop — not a lot at first, but a little. And if your credit utilization starts to approach 100% of your available credit then your credit score will likely suffer quite a bit.

Opening & Closing Credit Cards
When you open a new card, an inquiry is placed on your credit report. Inquiries account for 10% of your credit score and each new inquiry can cost a few credit score points.

Closing a credit card will increase your utilization rate, so your credit score may decrease a bit.

Debt-to-Income Ratio
Another important reason we say to spend less than you owe and pay off your credit card in a timely manner is because these spending habits are a reflection of your debt-to-income ratio. A debt-to-income ratio is one way lenders measure your ability to manage the payments you make every month to repay the money you have borrowed. To calculate your debt-to-income ratio:

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4. THE MISGUIDED AMERICAN CULTURE

We are constantly seeking to achieve the American Dream, whether we know it or not. Although the traditional family has transformed significantly from a white picket fence and two children raised by a stay-at-home mom into one where families range dynamically, the foundation of the American Dream holds true: health, wealth and happiness.

Unfortunately, wealth is associated with need when really it’s fueled by desire. Our growing culture of impatience has led to immediate, self-serving needs driven by instant gratification. It is this instant gratification that can quickly lead to our own financial abuse. Have you ever been in a situation where you want something right now but you don’t have the money to pay for it? You debate that your next paycheck is coming and this promise of money to come is what convinces you to buy. This occurrence can easily turn into a trend and debt begins to pile up and your credit score begins to hurt, all because of our need to have it now.

Instead of falling for the, “Limited Time Opportunity,” “One Day Sales,” and trends that are sure to go faster than they came, set yourself up for success by knowing what you need vs. want.

We aren’t completely at fault here though. Being marketed to with products that have a short shelf-life and going out to get them will thrill us only for a moment. Imagine having that feeling all the time simply by saving your money and knowing you can comfortably spend it when you decide to buy something you really love and worked so hard for. The moment of happiness that comes with instant gratification is just that, an instant. Turn instances into lifelong successes by saving instead of spending or spending wisely instead of irrationally and with money you have instead of borrowed money. This will help you maintain an excellent credit score so you can borrow money when you need to at a low interest rate and keep your finances under control.

5. ROLE IN FINANCE: GOVERNMENT AND CORPORATIONS

Errors on Credit Reports
It’s disturbingly likely that your credit report is wrong. Inaccuracies in credit reporting affect millions of Americans. A 2013 Federal Trade Commission study found 1 in 5 consumers have errors on their reports. And for one out of every 20 consumers, the report said, those errors could mean having to pay higher interest rates for things like car loans or insurance.

Consumer attorneys found that one of the sources of credit reporting inaccuracies are debt collectors, which often send inaccurate information to credit bureaus. In fact, credit reporting agencies are paid by data furnishers and this relationship is so skewed that the Hawaii Department of Commerce and Consumer Affairs’ (DCCA) Office of Consumer Protection (OCP) announced in May 2015 that credit reporting agencies have to pay a $6 million settlement and make a number of changes to their business practices to benefit consumers.

Under the settlement, the credit reporting agencies have agreed to increase monitoring of data furnishers, to require additional information from furnishers of certain types of data, to limit direct-to-consumer marketing, to provide greater protections for consumers who dispute information on their credit reports, to limit certain information that can be added to a credit report, to provide additional consumer education, and to comply with state and federal laws, including the Fair Credit Reporting Act.

Although lobbying was effective in the state of Hawaii, it’s long and drawn-out process that may or may not lead to change. The best steps you can take are to check your credit report at least three times a year and contact a credit repair company as soon as possible to get your finances and life back on track.

6. STEPS TO FINANCIAL SUCCESS

Errors on Credit Reports
It’s disturbingly likely that your credit report is wrong. Inaccuracies in credit reporting affect millions of Americans. A 2013 Federal Trade Commission study found 1 in 5 consumers have errors on their reports. And for one out of every 20 consumers, the report said, those errors could mean having to pay higher interest rates for things like car loans or insurance.

Consumer attorneys found that one of the sources of credit reporting inaccuracies are debt collectors, which often send inaccurate information to credit bureaus. In fact, credit reporting agencies are paid by data furnishers and this relationship is so skewed that the Hawaii Department of Commerce and Consumer Affairs’ (DCCA) Office of Consumer Protection (OCP) announced in May 2015 that credit reporting agencies have to pay a $6 million settlement and make a number of changes to their business practices to benefit consumers.

Under the settlement, the credit reporting agencies have agreed to increase monitoring of data furnishers, to require additional information from furnishers of certain types of data, to limit direct-to-consumer marketing, to provide greater protections for consumers who dispute information on their credit reports, to limit certain information that can be added to a credit report, to provide additional consumer education, and to comply with state and federal laws, including the Fair Credit Reporting Act.

Although lobbying was effective in the state of Hawaii, it’s long and drawn-out process that may or may not lead to change. The best steps you can take are to check your credit report at least three times a year and contact a credit repair company as soon as possible to get your finances and life back on track.

  1. Balance Your Budget
    We know you’ve heard this tip a million times: budget. The key here is to never spend more than you make. If you are, then it’s time to cut down and work on balancing your budget before you can set up your budget. If you can’t afford your smart phone, it might be time to downgrade so you can save more to afford finer things in life, later in life (especially when you can afford it).
  2. Pay Off Your Debt
    Between school loans and credit card debt, you might have a hefty sum of money that you owe the U.S. Government. Before you start saving, focus your efforts on aggressively paying down your debt as fast as possible. Whatever you do, avoid paying just the minimum! In fact, you should be putting the maximum amount you can every month towards paying down your debt. It’s best practice to start paying off your credit card with the highest interest rate first, then cancel cards that charge annual fees. What’s the point if you’re not using it? Be sure to keep at least one account open so your credit score has something to work with.
  3. No Car Payments Allowed
    If you don’t have a car payment, good work! If you do, start paying it off as soon as you can. You shouldn’t have a car payment, because you should only buy what you can afford. So if you have one, work on paying it off.
  4. Start Your Emergency Fund
    Once you’ve paid off your debts, it’s time to stay debt free. Work towards building an emergency fund that can last you 3-6 months should you lose your job or fall on hard times.
  5. Plan for Retirement
    This is the last thing people think to do because it’s taken care of by your company. But you should be saving as much for your future as possible, and this means taking actions like enrolling in automatic increase so that you are saving more for retirement every year without even thinking about it. After all, the amount of money that can be made on compounding an investment over 30 years is enormous
  6. Have Financial Accountability
    Whether we like it or not sometimes we all need accountability. Many times married couples are not both involved in the finances and that is where a lot can go wrong. If we aren’t held accountable for our spending then that we can fall to temptation and eventually that can lead to mistrust. Every relationship is different, but it is highly recommended that each person look at the accounts and share financial plans and spending

Communicate Your Plan
Paying off debt and saving money is an arduous and exhausting task and it only gets easier with the support of your friends and family. Communicate your plan to make it easier for other’s to understand why you may be missing out on movie night or not eating out as often. Communication is key to financial success!

The same goes for your significant other. When it’s two people saving up for something or trying to get their finances in order, there needs to be a system. Who does what? Who controls the finances? What are our budgets and which of you stays on top of them? Have a plan and stick to it as a team.

7. DIVORCE AND CREDIT

Unfortunately, many divorces have resulted as an outcome of financial stress. When financial stress threatens your relationship, it’s time to recognize the signs and take action.

Credit and Relationships
You already know that your spending habits affect your credit score but it can also affect your relationship. In fact, 20% of men and 30% of women say they won’t marry someone with a poor credit score. Those who worked hard to achieve financial independence don’t want to enter into a relationship that can threaten the result of their hard work.

Communicate & Plan
As you read, one of our number one suggestions is you communicate instead of avoiding. Not talking about money problems can only make things worse. Sit down together and make a plan. Set a budget and time each week or month to discuss it. This will help you both stay focused on the goal and maybe even revise your budgets should issues arise.

8. BANKRUPTCY AND CREDIT

How Filing for Bankruptcy Affects Your Credit
What’s worse than a poor credit score? Bankruptcy. Although creditors would rather not see bankruptcy on your credit report, the actual damage it does to your credit varies. It mostly depends on how your credit score fared before you filed for bankruptcy. For example, if you had a poor credit score to begin with and a high debt-to-asset ratio (lots of debt and a few assets), then your credit score will take a dip after filing, but it won’t take a plunge.

If you have a good credit score before filing for bankruptcy, then your score may take a much bigger hit after filing. According to FICO (the most widely-used credit scoring company in the U.S.), those with good credit should expect a huge drop in their score immediately after filing for bankruptcy.

Bankruptcy and Your Credit Report
When you file for bankruptcy, it will appear on your credit report for up to 10 years.

Chapter 13 vs. Chapter 7 Bankruptcy
Chapter 13 bankruptcy means that you repay some or all of your debts over a three to five year period.
Chapter 7 bankruptcy is a liquidation bankruptcy designed to wipe out your general unsecured debts such as credit cards and medical bills. If you may too much money, you may not qualify for Chapter 7 as it’s designed for individuals who have little or no disposable income.

9. IMPORTANCE OF CREDIT MONITORING AND GETTING HELP

Monitoring your credit is a great way to stay on top of your finances and ensure that no mistakes have been placed on your credit report. Reviewing it throughout the year isn’t enough. Getting the help of a credit monitoring service can help you immensely! They watch over your credit report every day and automatically notify you when changes occur.

Five Benefits of Credit Monitoring

  1. Stop Fraud Before It Starts
    Credit monitoring is perhaps one of the most effective ways to protect yourself against fraudulent activity. If fraud goes on for six months or more, it can cause severe damage to your profile. A credit monitoring service won’t wait six months to tell you, they’ll notify you as soon as the change happens.
  2. Convenience
    How convenient is it to not have to worry about checking your credit score? You don’t have to try to remember when you last checked it and can go on with your daily life knowing you’ll be notified as soon as something happens.
  3. Peace of Mind
    This goes hand-in-hand with peace of mind. Knowing you don’t have to check it and that it’s taken care of will help you focus on getting your budget together and staying on top of saving for a house, car or your next big purchase.
  4. Keep an Eye on Who Looks at Your Report
    A credit monitoring service will tell you who’s looking at your report. Between employers, lenders and credit checkers, it’s good to know who’s viewing what and if it’s accurate!
  5. Accuracy
    Credit inaccuracies are frequent. With credit monitoring you can detect and correct errors almost immediately.

Monitor Credit to Repair It
You have to monitor your credit to know if it needs repair. Instead of taking the tedious and drawn-out steps to repair your credit, a credit repair service made of a team of professionals can initiate audits and monitor the responses from creditors, collection agencies, public record providers and other reporting agencies.

You can work with a credit repair service to remove late payments, tax liens, collections, paid collections, repossessions, charge offs, foreclosures, judgements, bankruptcies and more.

10. BUDGETING AND RETIREMENT

Creating an expected budget for retirement will help you get a general idea of the type of life you want to live in retirement and what you’ll need to achieve it. Not sure where to start? You might consider using a rough estimate of 70% as essential and 30% for nonessential spending.

Costs to Include in Retirement Budget

  1. Healthcare Costs
    This will certainly be one of the biggest expenses to deal with in retirement. The U.S. Department of Health and Human Services predicts that 70 percent of those age 65 and older will require some type of long-term care services. The cost of care varies depending on whether you receive it at home, in adult day care, at an assisted living facility or in a traditional nursing home.
  2. Basic Living Expenses
    You are no longer setting aside money for retirement, trying to build a nest egg or paying off school loans. Other expenses that you do need to work about include basic expenses to keep your lights on and your water running. Utilities will be relatively unchanged so this is somewhat easy to account for. You will need to include the cost of various insurance programs you subscribe to, potentially including health, home, automobile, liability and long-term care coverage.
  3. Recreational Expenses
    Retirement is the time in life when you get to explore the world and really engage in your favorite hobbies but it can be easy to overdo it at first. With a little effort and budgeting, you can still do all that while still having sufficient savings to fund your efforts. Just take it slow!
  4. Unexpected Expenses
    You’ve had to account for these all your life and it’s no different in retirement. Whether your child needs to move back home or your car goes out, unexpected expenses can take a big hit on your savings. It’s best to keep a separate bit of savings aside for these type of situations.
  5. Miscellaneous Expenses
    You should revel in your interests during retirement and this can lead to miscellaneous expenses. If you’re into building boats for example, consider parts part of this miscellaneous expense. If you can make the right preparations and set aside the necessary funds there is no reason you cannot feed your fancies as a retiree.

11. WAYS TO SUPPORT YOUR FAMILY FINANCIALLY AND EMOTIONALLY

As the definition of the nuclear family has changed from the 1950s to date, women have quickly gone from bread makers to bringing home the bacon. You may be the CFO of your household and this is a far cry from the rights women had just half a century ago. Whether by circumstance or by choice, women are finding themselves in roles where they must be responsible for long-term financial needs and security and this extends to helping keep their family thriving, not just surviving.

Providing Financial Support
Financially supporting your family goes beyond providing the monetary means for them to live. It means teaching them the basics of good money handling practices, budgeting and saving tips.

  1. Patience is a Virtue
    You may have to wait to buy what you want. It’s not going anywhere and you can buy it when you’ve saved up enough money to afford it. Never borrow money to buy something you can’t afford unless it’s a home. Helping your family understand how to work against instant gratification is something that can help them in many areas of life.
  2. You are Responsible
    Help your family with scenarios to understand that they are responsible for their choices. It won’t hurt to talk about the importance of a credit score and how spending habits can affect this score which can hinder them from getting what they want. The idea that money is finite is an important idea to share.
  3. Opt to Save
    Help your family understand the importance of short-term goals and long-term goals and how saving money plays a part in both. The mantra here is, “never spend more than you can afford!”

Helping your family understand these three financial tips will help them emotionally because they will be free of financial stress in the future. They won’t have to worry about filing for bankruptcy or a poor credit score because they’ll know to monitor their credit and engage the services of a credit repair company should something go wrong. Keep them involved in your activities and help them be a part of day-to-day decisions so they can build confidence in their decisions.

CONCLUSION

Boost your own financial confidence and start your financial journey now. Stay on top of your credit report and be sure to repair any inaccuracies as soon as possible so you aren’t swallowed by a low credit score. Take action now to ensure that your money is working just as hard as you do, so you can achieve the goals and live the life you deserve.

If you do need help from the most experienced credit services company in the industry CRE Credit Services has helped tens of thousands of consumers on the path to financial success!

[i] Credit Union National Association.

[ii] Women, Money and Power Study: Empowered and Underserved, Allianz Life Insurance Company of North America, 2015

[iii] Your credit score doesn’t affect your rate: partially debunking a car insurance myth. Esurance. 2015.

[iv] Can someone with bad credit invest in real estate? Realtor.com. 2015.

[v] Coleman Report. 2013.

[vi] Do you need excellent credit to start a business? Entrepreneur.com. 2004.

[vii] FTC Study. Federal Trade Commission. 2013.

[viii] Debt collectors have figured out a way to seize your wages and savings. Huffington Post. 2014.

[ix] State office of consumer protection announces $6 million settlement with credit reporting agencies. DCCA Hawaii. May 20, 2015

[x] Freecreditscore.com. 2013.