Boy, I’m thankful that Thanksgiving is over! After the media barrage about how we can undo the damage done to our waist lines, I can now get back to focusing on my financial “waste lines” – fixing my spending habits, past and present.
Judging from what I’m hearing from ag financial advisors, credit is tightening down even for farms. And our financial health is going to become just as important as our physical health. Both will cost us dearly if we aren’t vigilant.
I used to think that using low-interest or no-interest credit, it was to my advantage. (Call me gullible.) But recently, I figured out that all those nice people who extended me that credit weren’t doing me any favors. (Yep, I’m a slow learner.)
My wife and I keep a couple major credit cards. One of the credit card companies “fessed up” that an employee had absconded with personal financial data. So we received a free one-year subscription to a credit monitoring report. (If you’re wondering, I have an excellent score.)
But we were shocked to discover a number of retail store accounts still open – from as far back as 20 years ago. Some were multiples of the same store. When we bought furniture, for instance, apparently it was easier for the sales person to open a new account than pull up the old one. (No, I don’t buy much furniture. In our house, it’s got to be worn out or broken to replace it – much to my wife’s chagrin.)
My point for mentioning it . . .
Unused credit accounts – not just credit cards – drag down your credit score. As lenders become more selective about who merits their lowest interest rates, you want your best score possible. The difference between just a good and an excellent credit rating can easily be a 1.60% difference in interest rates. And, I’m told that 79% of credit reports contain errors.
I strongly urge doing what I resisted doing: Have a credit agency send you a report from the three major credit analysis agencies – TransUnion, Equifax and Experian. If you’re on really good terms with your banker, they might give you one for free. You’ll be as surprised as we were.
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