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Building A Good Credit Score: 5 Tips

Building A Good Credit Score: 5 Tips

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    Having a solid credit score has been important for quite a while now, but it’s actually becoming more important these days as lending tightens up. There’s a reason that the Fair Isaac Corporation — the organization that calculates the credit score that most major lenders rely on — has been changing the way that credit scores are calculated. All of these circumstances add up to the fact that even someone who is confident that their credit score is good should be making sure it stays that way. There are some relatively simple steps, though, that you can take to help yourself build up your credit score, as well as maintain it.

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    1. Get A Copy of Your Credit Report

    Although you can’t get your exact credit score for free, you can get a free copy of your credit report from each of the three credit bureaus (Experian, Equifax and TransUnion) once each year. To do so, visit AnnualCreditReport.com and request a report. AnnualCreditReport.com, by the way, is actually the only way to get your reports for free — the site was created in response to federal legislation requiring that the three national credit reporting companies inform consumers about their status. Despite their catchy commercials, companies like FreeCreditReport.com actually wind up charging you for expenses related to obtaining your credit report.

    2. Make Sure You’re Aware of Any Existing Accounts

    Typically, your credit report will show any accounts you have open — although different companies report to different credit bureaus, and some companies don’t seem to report at all. It’s easy to forget about credit accounts that you don’t actually use, like credit cards you stopped using but chose not to close the account ‘just in case.’ These credit accounts can easily represent the most likely upcoming dings to your credit: card companies and other lenders have started closing inactive accounts in order to limit their liability. As the amount of credit a person has goes down, so does their credit score. I’m not suggesting that you should start charging items to those inactive accounts, though — instead, it’s enough to be aware of them so that if your accounts do close, you won’t be taken by surprise.

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    3. Set Up Automatic Payments

    One of the easiest credit score factors you can control is how good you are about making payments on your current balances. Even if you don’t usually carry a balance, making a payment or two late can cause a preventable dip in your credit score. A simple slip up, like forgetting to send a payment, can have some major consequences. While FICO scores will be offering more leniency for someone who misses only one payment, automatic payments can be a simple way of avoiding even one late payment and any problem at all. Late and missed payments can have ripple affects beyond your actual credit score as well — in some cases, including credit cards, a missed payment on one account can lead to a higher interest rate on another account.

    4. Get Serious About Your Balances

    One of the factors in a good credit score is how much credit you have available. That means that reducing your current balances has a direct connection to helping your credit score. That doesn’t mean that you have to pay off your entire balance immediately to improve your credit score, though: while it’s a good overall goal, just adding a few dollars to your minimum monthly payment is enough to at least get you started on an upwards trend. Moving around debt, say to a zero-interest credit card, doesn’t actually help with your overall credit score. While it may make the amount easier to pay off, it can be reflected in your credit score as an inability to manage your existing credit.

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    5. Keep Your Number of Cards Constant

    While your available credit is a key factor in your credit score, opening a bunch of new credit cards just to increase the amount of credit you have available won’t really help. Instead, the system used to determine credit scores reads such a move as a need for more credit: if you open several cards in a short time span, credit reporting agencies assume that you plan to use that credit and might even be planning to get yourself into some trouble with it. Closing unused credit cards can also have a negative impact on your credit, so keeping your number of cards constant is usually the best compromise between getting the best credit card options and maintaining your good credit score. Your account age can also play into things, by the way. That first credit card you ever got, with its awful interest rate, may be an important part of your credit score. Think carefully before closing such an account.

    Your Credit Score and You

    Despite many ads to the contrary, there is really no way to fix your credit score in a hurry. The Fair Isaac Corporation works hard to make sure that credit scores indicate how you use credit over time, and the company knows what it’s doing. That means that you have to work on maintaining a good credit score long before you want to make a big purchase, like a house or a car. Since it’s not always predictable exactly when a person is going make those large purchases, it makes sense to make a good credit score an ongoing priority.

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    Last Updated on September 18, 2020

    7 Simple Rules to Live by to Get in Shape in Two Weeks

    7 Simple Rules to Live by to Get in Shape in Two Weeks

    Learning how to get in shape and set goals is important if you’re looking to live a healthier lifestyle and get closer to your goal weight. While this does require changes to your daily routine, you’ll find that you are able to look and feel better in only two weeks.

    Over the years, I’ve learned a lot about what it takes to get in shape. Although anyone can cover the basics (eat right and exercise), there are some things that I could only learn through trial and error. Let’s cover some of the most important points for how to get in shape in two weeks.

    1. Exercise Daily

    It is far easier to make exercise a habit if it is a daily one. If you aren’t exercising at all, I recommend starting by exercising a half hour every day. When you only exercise a couple times per week, it is much easier to turn one day off into three days off, a week off, or a month off.

    If you are already used to exercising, switching to three or four times a week to fit your schedule may be preferable, but it is a lot harder to maintain a workout program you don’t do every day.

    Be careful to not repeat the same exercise routine each day. If you do an intense ab workout one day, try switching it up to general cardio the next. You can also squeeze in a day of light walking to break up the intensity.

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    If you’re a morning person, check out these morning exercises that will start your day off right.

    2. Duration Doesn’t Substitute for Intensity

    Once you get into the habit of regular exercise, where do you go if you still aren’t reaching your goals? Most people will solve the problem by exercising for longer periods of time, turning forty-minute workouts into two hour stretches. Not only does this drain your time, but it doesn’t work particularly well.

    One study shows that “exercising for a whole hour instead of a half does not provide any additional loss in either body weight or fat”[1].

    This is great news for both your schedule and your levels of motivation. You’ll likely find it much easier to exercise for 30 minutes a day instead of an hour. In those 30 minutes, do your best to up the intensity to your appropriate edge to get the most out of the time.

    3. Acknowledge Your Limits

    Many people get frustrated when they plateau in their weight loss or muscle gaining goals as they’re learning how to get in shape. Everyone has an equilibrium and genetic set point where their body wants to remain. This doesn’t mean that you can’t achieve your fitness goals, but don’t be too hard on yourself if you are struggling to lose weight or put on muscle.

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    Acknowledging a set point doesn’t mean giving up, but it does mean realizing the obstacles you face.

    Expect to hit a plateau in your own fitness results[2]. When you expect a plateau, you can manage around it so you can continue your progress at a more realistic rate. When expectations meet reality, you can avoid dietary crashes.

    4. Eat Healthy, Not Just Food That Looks Healthy

    Know what you eat. Don’t fuss over minutia like whether you’re getting enough Omega 3’s or tryptophan, but be aware of the big things. Look at the foods you eat regularly and figure out whether they are healthy or not. Don’t get fooled by the deceptively healthy snacks just pretending to be good for you.

    The basic nutritional advice includes:

    • Eat unprocessed foods
    • Eat more veggies
    • Use meat as a side dish, not a main course
    • Eat whole grains, not refined grains[3]

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    Eat whole grains when you want to learn how to get in shape.

      5. Watch Out for Travel

      Don’t let a four-day holiday interfere with your attempts when you’re learning how to get in shape. I don’t mean that you need to follow your diet and exercise plan without any excursion, but when you are in the first few weeks, still forming habits, be careful that a week long break doesn’t terminate your progress.

      This is also true of schedule changes that leave you suddenly busy or make it difficult to exercise. Have a backup plan so you can be consistent, at least for the first month when you are forming habits.

      If travel is on your schedule and can’t be avoided, make an exercise plan before you go[4], and make sure to pack exercise clothes and an exercise mat as motivation to keep you on track.

      6. Start Slow

      Ever start an exercise plan by running ten miles and then puking your guts out? Maybe you aren’t that extreme, but burnout is common early on when learning how to get in shape. You have a lifetime to be healthy, so don’t try to go from couch potato to athletic superstar in a week.

      If you are starting a running regime, for example, run less than you can to start. Starting strength training? Work with less weight than you could theoretically lift. Increasing intensity and pushing yourself can come later when your body becomes comfortable with regular exercise.

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      7. Be Careful When Choosing a Workout Partner

      Should you have a workout partner? That depends. Workout partners can help you stay motivated and make exercising more fun. But they can also stop you from reaching your goals.

      My suggestion would be to have a workout partner, but when you start to plateau (either in physical ability, weight loss/gain, or overall health) and you haven’t reached your goals, consider mixing things up a bit.

      If you plateau, you may need to make changes to continue improving. In this case it’s important to talk to your workout partner about the changes you want to make, and if they don’t seem motivated to continue, offer a thirty day break where you both try different activities.

      I notice that guys working out together tend to match strength after a brief adjustment phase. Even if both are trying to improve, something seems to stall improvement once they reach a certain point. I found that I was able to lift as much as 30-50% more after taking a short break from my regular workout partner.

      Final Thoughts

      Learning how to get in shape in as little as two weeks sounds daunting, but if you’re motivated and have the time and energy to devote to it, it’s certainly possible.

      Find an exercise routine that works for you, eat healthy, drink lots of water, and watch as the transformation begins.

      More Tips on Getting in Shape

      Featured photo credit: Alexander Redl via unsplash.com

      Reference

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