Canine
Well-known member
I recently realized that I wanted to improve my credit for two reasons: 1) To more easily receive credit if/when needed and at a lower interest rate and 2) To be able to qualify for things that use a credit score such as entering into a phone contract, hooking up gas/electric, renting an apartment or renting a car (depending how you pay).
#2 got me to thinking. Credit scores are being used for more and more transactions that aren't strictly monetary loans. Who knows what I'll need in the future that might end up needing a good credit score just to get my foot in the door, or possibly an excellent credit score to beat possible "competitors" (like who would be the best candidate for an apartment). I know my credit score is at least decent because I always pay my bills on time and mostly ahead of time. I have one credit card that I almost always pay in full at the end of the month. Sometimes I let a couple hundred dollars stay on there for a couple weeks before I zero out the balance. But I wanted to improve my score, so this is what I learned. I'm not an authority on this, and every ones wants/needs are different, so check it out yourself.
FICO score is based on 6 considerations. The first 3 are the biggies: 1) 35% is Pay your bills on time and pay what you owe. 2) 30% is utilize only 30% of your credit. If you consistently utilize 90% of your credit despite paying it off every month, you would be hurting your score. If you have a $2000 credit limit, try to keep it under $600. At the most you shouldn't go over 75%. And 3) 15% is if you pay off a credit card, don't close the account. By reducing your available credit, your credit score goes down. Instead make a couple charges or so throughout the year to keep it active and of course pay it off before the end of the billing period. This is 80% of your score! This is very easy to understand and implement to improve your FICO score. If you are ambitious and want to strive for the perfect score, go for the other 3 considerations (20% of your score)! That is a good goal.
I chose to get another credit card to supplement the Visa card from my credit union. I originally chose a credit union because you will almost always get outstanding customer service and a great rate. Mine is 11.99%. Banks not so much, but if you travel, having a bank with nationwide coverage may be a good thing. I applied for the American Express Blue Cash Everyday and got it. Was surprised about that. I chose this because it gives cash back on groceries, gas, and other purchases like renting a motel or buying a TV. I spend very little, but when i do, I want to make my money work for me.
A cash rewards card is just as good for gas as a dedicated gas card. A gas card requires you to get gas at specific stations. Montana has tons of small towns and you often have little if any choice. You take what they have or you walk. Even if you are in a bigger town, you may need to drive a few miles to find another gas station that will accept your gas card. One of the Big 4 (Visa, Mastercard, AMEX, or Discover) will take care of any brand. Getting gas with a credit card is awesome. You may find yourself driving through Eastern Montana and need gas, but if it is after 11:00 p.m., you will need to wait until the next day. I bet sections of Alaska are like that, too.
Store cards like Sears, Target, Scheels, etc, may not report your awesome credit history. I absolutely insist that my card usage will be reported so my credit score increases. The Big 4 report your credit history.
Have 2 or 3 credit cards and get those cards from different institutions. When we had that bank collapse several years ago, some banks were cancelling credit cards right and left. Then some people were left without a credit card. Very frustrating and possibly seriously problematic. Also, I had my card hacked three times in one year and went without a card for several days during those times. Was not a bummer deal for me, but could've been. Or you could lose a card. A little redundancy in regards to credit cards is a good thing. It also increases the lines of credit you have which increases your FICO score.
I wanted an RFID card, so I chose one with one of those chips in it. Yes, they can be hacked by someone with inexpensive relatively simple radio equipment, but if it is hacked, they can only use the card once. The crooks can't imitate the chip itself and the chip gives a different number every time it is used. The crook will take that number, put it on a magnetic strip, make a purchase, toss the fake card, then go to the next card he made. No security measure is full proof, but the RFID is much safer than a standard magnetic strip. I don't know how that would apply to online purchases, though. I'll have to try it and see.
RFID blockers for your wallet/purse aren't all made the same. Most will only mute the signal- not completely block it. I want the ninja of RFID blockers, but I'm not sure that exists yet.
I found this info easy to understand and apply. I hope it helps you if you choose to improve your credit situation. I realize some people don't want a credit card and that's fine. I have a friend that is a bookkeeper and does a surprisingly good job, but she can't handle her own money. She can't even balance her checkbook, yet she can balance a multimillion dollar company's books and even audit errors in the books. Weird.
Many of us travel and having 2 or 3 credit cards can not only be a serious convenience, but truly a lifesaver. When you are in a town of strangers, you pretty much need to rely on yourself. Money in the form of a credit card can be your best friend. Well, next best friend if you have a dog. Or a kitty!
Debit cards are a different animal; I purposely left them out as this post is long enough!
#2 got me to thinking. Credit scores are being used for more and more transactions that aren't strictly monetary loans. Who knows what I'll need in the future that might end up needing a good credit score just to get my foot in the door, or possibly an excellent credit score to beat possible "competitors" (like who would be the best candidate for an apartment). I know my credit score is at least decent because I always pay my bills on time and mostly ahead of time. I have one credit card that I almost always pay in full at the end of the month. Sometimes I let a couple hundred dollars stay on there for a couple weeks before I zero out the balance. But I wanted to improve my score, so this is what I learned. I'm not an authority on this, and every ones wants/needs are different, so check it out yourself.
FICO score is based on 6 considerations. The first 3 are the biggies: 1) 35% is Pay your bills on time and pay what you owe. 2) 30% is utilize only 30% of your credit. If you consistently utilize 90% of your credit despite paying it off every month, you would be hurting your score. If you have a $2000 credit limit, try to keep it under $600. At the most you shouldn't go over 75%. And 3) 15% is if you pay off a credit card, don't close the account. By reducing your available credit, your credit score goes down. Instead make a couple charges or so throughout the year to keep it active and of course pay it off before the end of the billing period. This is 80% of your score! This is very easy to understand and implement to improve your FICO score. If you are ambitious and want to strive for the perfect score, go for the other 3 considerations (20% of your score)! That is a good goal.
I chose to get another credit card to supplement the Visa card from my credit union. I originally chose a credit union because you will almost always get outstanding customer service and a great rate. Mine is 11.99%. Banks not so much, but if you travel, having a bank with nationwide coverage may be a good thing. I applied for the American Express Blue Cash Everyday and got it. Was surprised about that. I chose this because it gives cash back on groceries, gas, and other purchases like renting a motel or buying a TV. I spend very little, but when i do, I want to make my money work for me.
A cash rewards card is just as good for gas as a dedicated gas card. A gas card requires you to get gas at specific stations. Montana has tons of small towns and you often have little if any choice. You take what they have or you walk. Even if you are in a bigger town, you may need to drive a few miles to find another gas station that will accept your gas card. One of the Big 4 (Visa, Mastercard, AMEX, or Discover) will take care of any brand. Getting gas with a credit card is awesome. You may find yourself driving through Eastern Montana and need gas, but if it is after 11:00 p.m., you will need to wait until the next day. I bet sections of Alaska are like that, too.
Store cards like Sears, Target, Scheels, etc, may not report your awesome credit history. I absolutely insist that my card usage will be reported so my credit score increases. The Big 4 report your credit history.
Have 2 or 3 credit cards and get those cards from different institutions. When we had that bank collapse several years ago, some banks were cancelling credit cards right and left. Then some people were left without a credit card. Very frustrating and possibly seriously problematic. Also, I had my card hacked three times in one year and went without a card for several days during those times. Was not a bummer deal for me, but could've been. Or you could lose a card. A little redundancy in regards to credit cards is a good thing. It also increases the lines of credit you have which increases your FICO score.
I wanted an RFID card, so I chose one with one of those chips in it. Yes, they can be hacked by someone with inexpensive relatively simple radio equipment, but if it is hacked, they can only use the card once. The crooks can't imitate the chip itself and the chip gives a different number every time it is used. The crook will take that number, put it on a magnetic strip, make a purchase, toss the fake card, then go to the next card he made. No security measure is full proof, but the RFID is much safer than a standard magnetic strip. I don't know how that would apply to online purchases, though. I'll have to try it and see.
RFID blockers for your wallet/purse aren't all made the same. Most will only mute the signal- not completely block it. I want the ninja of RFID blockers, but I'm not sure that exists yet.
I found this info easy to understand and apply. I hope it helps you if you choose to improve your credit situation. I realize some people don't want a credit card and that's fine. I have a friend that is a bookkeeper and does a surprisingly good job, but she can't handle her own money. She can't even balance her checkbook, yet she can balance a multimillion dollar company's books and even audit errors in the books. Weird.
Many of us travel and having 2 or 3 credit cards can not only be a serious convenience, but truly a lifesaver. When you are in a town of strangers, you pretty much need to rely on yourself. Money in the form of a credit card can be your best friend. Well, next best friend if you have a dog. Or a kitty!
Debit cards are a different animal; I purposely left them out as this post is long enough!
