It's hard to believe that your life can be so impacted by one number–your credit score. In fact, that number says so much about a person that people are constantly bombarded with ways to improve it. Why should you be worried about your credit especially if you're young and have lots of time to pay your bills? If you're just starting out, but your credit needs work, here are four reasons why you should take that number seriously and start improving it today.
Securing Better Loan Rates
Loans are a part of life whether it's a car loan or a mortgage. If you've recently had an emergency and secured a personal loan with bad credit, be sure to work as hard as you can to pay that loan off on time and as quickly as possible. Doing this will begin to elevate your score and as you improve it, you'll be able to secure a lower interest rate on any loans you take out in the future. Remember, loan rates are different for everyone and are directly correlated with your credit, so paying on time will save you money later in life.
Obtaining Mortgages and Rentals
Owning a home is a common dream for most people, but if your credit is tanking, that goal can easily fade away. Working to get your credit back in shape will allow you to be quickly approved for a mortgage, especially when rates are so good. The same applies to renting an apartment where credit checks are now routine. If you'd like to better your living situation, start by working on your credit.
Finding a Steady Job
Finding a job is becoming increasingly difficult and in many states, employers can legally run a credit check on potential hires. If the job you're applying for is managerial or involves money in any capacity, you can bet they'll be looking at how you run your own finances. A poor credit rating and large debt, unfortunately, may sabotage your chances, even when you're trying to solve that very situation. Working to better your credit now, before you find yourself in that position, could help your job search.
Making Major Purchases
Good credit can help you get even more credit when you need it. Someday, you'll want that new motorcycle, swimming pool or an expensive vacation. The way you pay your bills now will impact the amount of credit you're approved for in the future. If you take responsibility now, any of these things will be completely within your reach. Think of paying down your bills today as a down payment on your future, because they're all connected.
Investing in Tomorrow
Improving your credit and raising that one very important number takes discipline and self-control when it comes to how you pay your bills. The good news is that as you develop better financial habits, you'll see your efforts pay off when that number begins to steadily rise. Building a better credit score today is the key to getting the things you want tomorrow.