The Daily Tip Jar

Your personal credit is vital to your own future even if you don’t realize it now. Those offers in the mail can be quite enticing. It could be fun to venture out and purchase whatever you want to. The day will arrive though when your mailbox is packed with the bills, and in case you aren’t able to pay them back, your credit is likely to be destroyed.

– Limit it to necessities

Such as two credit cards and the lending options you have to have. Are you really in need of a new car right now? If not, keep carefully the one you have and put the cash you would spend on a monthly payment into personal savings. When it is time to buy a new car you’ll have a nice down payment ready to offer.

– Limit the number of open accounts you have on your credit report.

Do you really need a store credit card when you already have two personal credit cards in your wallet? In most cases, there is no need to apply for the additional credit. It can just lead you to be tempted to access it so you are best to leave it alone. You should never be relying on credit cards to pay for your necessities. If you are, your budget needs a very close look and changes need to be implemented.

– If you work hard to establish your credit, you can also call the shots with lenders.

Let that car dealership know that if a 7% rate of interest is the best they will offer you then you will go somewhere else. Of course, you can’t say this if you haven’t been responsible with your credit. The rate of interest is very important as part of your disposable income is going to be eaten away by it. Why give lenders more than you have to? Car loans are often five years and home loans thirty years. Over that length of time, the amount of money you can save with a lower interest rate is substantial.

– Make sure you have enough money in savings to cover two months of your regular expenses.

This way if something unexpected happens you will be able to take care of your payments without being late or getting a bad mark on your credit. It can seem like forever when you are trying to get caught up. You also don’t want to have to rely on credit cards to pay for your essentials as the interest will eat you alive.

– If you can’t make your monthly payments, you need to contact your creditors immediately.

They may be able to help you find a good solution to reduce the payments or for you to get an extension due to a hardship. If you don’t contact them, they will assume you don’t care. This can result in negative information being placed on your credit rating. This can result in you not being able to get the future credit that you need.

Getting personal credit is a privilege and not a right. Don’t assume that just because you need funding that someone is going to give it to you. The real world doesn’t work this way. If you aren’t prepared for handling personal credit then be responsible enough to enroll in a class. Sometimes we fall into the same financial problems as our parents as we haven’t been exposed to better ways to handle financial matters. Doing all you can to protect your personal credit is going to assure that it is there when you need it for your future.

In addition to that, be careful with predatory lending as well. There are many companies and lenders that victimize those that may need credit. They bill them ridiculous fees, high-interest rates, and even fees for paying off funds that were extended to them early. Stay clear of getting yourself involved with these kinds of agencies because they are going to cost you money and perhaps your good credit as well.

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