While you're working
toward building an emergency fund, saving for a down payment on a house or car
and setting aside something for retirement, don't overlook another important
aspect of financial planning - looking after your credit. Even young professionals
who have a grasp on other aspects of their finances may be unsure how credit
fits into the mix.
Generally, people starting out in their careers
have one of two experiences with credit: they've either never used it at all,
or over used it (in the form of credit cards or student loans) to the extent
that they're already deeply in debt. In either scenario, it can be difficult to
know what you need to do to monitor your credit.
If you're a credit novice, congratulations! Your
clean slate means you have a great opportunity to start out on the right foot. Your initial steps toward credit management
* Obtain your credit report and familiarize
yourself with what's on it.
* Educate yourself on how a credit score is
calculated and what factors influence your score. These include: payment
history for bills in your name, how much you owe, the length of your credit
history and the variety of types of credit you use. Since you're a credit
beginner, you'll need to start building a credit history.
* Start making small, judicious uses of credit.
For example, you may choose to obtain a credit card and use it to make a modest
purchase of a piece of technology or an appliance. Pay off the balance
immediately. Or, if you need a new vehicle, an auto loan can help you build
your credit history.
* Get into the habit of monitoring your credit
regularly with a product like CreditReport.com, which offers its members
valuable tools to help manage their credit for a monthly fee.
If you already have some credit history, the
beginning of your career is a great time to review it and take steps to better
manage your credit. Your regular tasks should include:
* Reviewing your credit history to get an idea
of what you've done right so far, and what you need to improve.
* Learning what factors influence your credit
score in both positive and negative ways. For example, paying down the balance
on credit cards can improve your utilization ratio.
* Eliminating credit card debt and making
responsible use of other types of credit, such as an auto loan or home
The early days of your career can be a busy with
a lot of adjustments, but it's also a ripe opportunity to plan for your
financial future. Learning the benefits of monitoring your credit and seeing
how it fits into your overall financial well-being is an important aspect to
grasp early on. Karen Venier is a
Broker Associate at Keller Williams. She is a part of Carr Peck Group which has
been recognized locally and nationally as in expert in real estate.
Locally they are 6th in Denver Metro home
sales out of 5,000 agents and have been recognized by the Wall Street Journal
and Real Trends as one of the top selling agents in America. For more
information feel free to contact heror call
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Author:Jason Peck Phone: 720-446-6301 Dated: July 10th 2014 Views: 2,473 About Jason: ...
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