Financial Advice For The Masses

Poor budgeting is a major reason why people have bad credit scores. Spend time formulating a weekly and monthly budget. It will allow you to spend less than you earn and put extra money toward paying off your debt.

Savings
Try to save each month for emergencies. By saving, you will avoid over-extending your credit cards, which can bring your credit score down. Start out with saving 5% of your income every month and then go to 10%. You can have your bank take the money out every month and have it transferred to your savings.

Building assets
It can help you improve your credit score by allowing you to apply for secure credit lines using your assets as collateral.

Plan for a financial emergency
Emergencies such as losing your job, a medical crisis, or a death in the family can often be an unexpected financial strain if you’re unprepared. You must have money in place to maintain your bills, or your credit score could take a hit because all of your available money will go toward your emergency.

Get the right insurance to help with emergencies
Get life insurance, health insurance, disability insurance, credit card insurance, loan insurance, and car insurance. If you have an emergency in any of these areas and you don’t have proper coverage, you can find yourself in serious debt and with a damaged credit score.

Marriage and your credit score
If you are married and you and your spouse decides to get a divorce, joint accounts can bring your credit score down if one of you does not pay the bill. Even if you’ve gone to court and have legally decided who will be responsible for each bill, the only thing that matters to your creditors is that one of you sends your payment on time. According to the credit card companies, both parties are liable for the debt.

Know how money works
Learn the ins and outs of how money works for you so that you can be better prepared to pay your bills. You should also read books on money and budgeting and attend seminars.

Staying in financial shape
When applying for loans, a lender will look at your savings, your income, and your employment. You want to make sure that you keep a good amount of savings in your account to show the lender that you have discipline when it comes to handling money. They will also look at your income to see whether you make enough money to keep up with the monthly payments. Finally, they will look at the length of employment to make sure that you are stable. The above factors will help you get a loan, which will help you raise your score in the long run.