Next week we officially leave 2015 behind and head into the new year. As with every January 1st it is a great time asses your life, your financial situation, your health and make a resolution for the new year. What is going to be your main goal for the year? Are you wanting to build a savings, are you wanting to get a home, or maybe you are just wanting to pay down your debts? Well if any one of those are you goals you will need a plan to get there. Without a plan you may find yourself next year with looking at the same goals.
Build A Savings
If building a savings is your goal the first thing you will need to do is to make a budget. You need to determine how much money you have coming in every single month and how much is going out towards all of your bills and how much is going out for fun stuff like eating out, concerts, and other fun activities. Once you have your budget you can see if you have any money leftover. This money can be set aside for savings. If you don’t have any money left over you will need to see what can be done to either make money each money or to cut down on expenses. Cutting down expenses can be accomplished simply by eating out less each money, or making sacrifices like getting rid of cable tv or switching to a cheaper phone plan.
Paying Down Your Debts
If your resolution is to pay down your debts the great news is the steps are the same as building a savings. You create a budget and see how much more than the minimums you can pay on all of your bills. Paying down your debts is a great thing to do because not only will your balances go down but as they do your monthly payments will as well which will eventually give you more money later on to put in your savings. Another great benefit to paying down your debts is the impact is has on your credit score. As your balances go down you will improve your Credit Utilization Ratio with is the second most important piece of your credit score.
Getting A Home
Getting a home is the main resolution we see at CRE Credit Services. With interest rates so low and housing fairly affordable right now it makes sense to purchase a home. Not just for the comfort of more space, a yard ,and the stability that goes with it but also as an investment. To buy a home you, though, there are some things that first need to be done. You will need to be assured that your credit score will qualify. That means getting a score in the high 600’s just to qualify for the higher rates. If your credit score is lower than that you may need to look into doing credit repair designed to help you get a mortgage like what we do here. Another thing you will need to get a home is to have money for a down payment. Lenders generally want you to have 20% of the home to put down or at least 3% with the purchase of special insurance. If you can do that then you can start to find a realtor that will can help you find a home in your budget.
The Point of Chip Cards
If you remember in the news or even on our blogs here over the last few years there have been many mentions of credit card information being stolen from departments stores and gas stations. Target alone had about 40 million account numbers stolen. The reason for this has to do with the magnetic strip on the back of your card. That technology is severely outdated and basically is the same level as a VHS which no one has used almost 20 years. The magnetic strip first came to be in the 60s so you can understand just how old this technology is. The problem with the magnetic strip is that it stores all your banking information on it and gives it to the seller every time you use it. So if a person has a “skimmer” on a credit card machine then they can easily steal your account. With a chip card however, the information is encrypted and actually changed and scrambled every time you use it. This makes it much harder for people to steal your information.
This Is a Good Thing
With about a million stores right now in the country able to read the chips the FBI is already seeing a dramatic drop in theft and expect that to continue as more and more stores catch up. The plan is to actually phase out the magnetic strip on your card completely over the next few years. So while right now it may take a while to get used to switching over just know that this is a good thing and something that should have actually happened years ago.