If You Want to Buy the Things You Need

Investments are only one part of your financial plan that is needed to have a good comfortable life. You also need education to get a good job. Third, you need to be able to control your income and expenses so that your net worth can grow. Net Worth will open the doors for you to gain status in society. The higher you go in society, the better off your children will be. It all comes down to where your children will start in life. The child that worries about where their next meal will come from or if they will live through the day in school will not do as well as the person who does not have to worry about such things. The fourth part smooths out your financial plan. That fourth part is your credit rating.

Let's review what you have learned in the past about your credit.

Typically, you would find out when an account goes to collections. But sometimes a bill can slip through the cracks, like an old utility bill sent but not forwarded after you've changed addresses.

If you want to buy the things that you need, you better maintain good credit. If you want a good paying job, you better maintain good credit. If you want to buy a new A1 condition car, you better maintain good credit. If you want to borrow a car, you better have good credit.

These are the things that the public school system will not teach you or your children. Many people think that credit is an extension of their paychecks and they do not have to pay it back. I can recall people saying things like, “I know my credit is bad” like they are proud of such a status. Some very ignorant and stupid well-wishers think that co-signing a loan for someone is the Christian thing to do. They don’t pay the loan and the loan falls on you, the well-wisher. You don’t pay the loan and your credit is the one that is damaged. 

The only thing people have of any value is their word! This is what is meant by the saying, “His word is as good as gold.” or "his word ain't worth shit!" When you borrow money and you say that you are going to pay it back with interest, you are giving your word that this is what you are going to do. Here is why people will give you a high paying job and lend you ever increasing amounts of money.

Things happen through life, job dismissals, illnesses, home break ups, and etc.  If this happens to you, it might take years for you to get your credit back to a 750 to 820 credit score. The first thing that you must do is monitor your credit report.  

When you monitor your credit regularly, you can make sure that anything negative appearing on your report is accurate. If I were you, I would monitor my credit report at least once a year. Most credit reporting services will allow you to do that. Look for “dings” in your credit report that can cause you to lose that good job, new car, or the revolving low credit high sealing credit account that you want. Here's an idea of what these items are and the impact they have on your credit score.

Late payments

Late payments can damage your score, depending on how late the payment was made, and how long it's been since that occurred. The later the payment was made, the more it hurts your score. If you are one day late making your payment, you are 30 days late. That clock starts when the store or bank receives your payment, not when you put the payment in the mail.

However, its effect on your credit diminishes over time. If you made a late payment 3 years ago and you have not had one since, that late payment will mean very little to your creditors.

Collections

 Reviewing your report can help here: if you find an item that isn't yours, you can dispute it, and if it is yours, you can pay it. These items can stay on your credit report for up to seven years. As with late payments, the longer it's been on your report, the less it affects your score.

Adverse public records

As a general rule, unpaid city, state, and federal tax liens can remain on your credit reports for up to 7 years from the payment date. These items will negatively affect your credit score and only time diminishes their impact on your credit. Generally, Chapter 7, 11, and 13 bankruptcies appear as public record items on your credit report for up to 10 years after filing. Chapter 13 bankruptcy records are sometimes taken off sooner, 7 years after filing, depending on the credit reporting company's policy.

Your best course of action

Start by checking your credit report. If you believe any items on your credit report are inaccurate, dispute them with the associated bureau.

If items are accurate, make sure you've paid any overdue accounts. Then ask the credit bureau how much longer the item will remain on your credit report. In the meantime, maintain your overall good credit health by paying bills on time and using less than 35 percent of your available credit. Keep monitoring to watch your progress!