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Top 5 Things Highly Credible People Don’t Do

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Top 5 Things Highly Credible People Don’t Do

Good credit is essential for almost anything finance related. From buying a house to opening a credit card, having a good credit score ensures you get the best interest rates and you can open high lines which you can access in an emergency. Building your credit is important and it’s not something you do instantly. However, if you want to learn how to increase your credit score and at the same time, learn good habits, you should follow these things which people with good credit don’t do:

1. They Don’t Pay Their Credit Cards on Their Due Date

Credit card payments are due on a specific date and most people wait until this day to pay them to maximize their credit capacity. However, people with excellent credit usually pay off their cards early. While paying on time means you won’t incur any fee, you might incur a penalty on your credit score. This is because your credit utilization rate goes up when you wait until your due date to pay. If you make a big purchase, then try to pay this off early before you credit card company reports the balance to the credit score companies. That way, you will get a lower utilization rates.

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2. They Don’t  Refuses Credit Limit Increases

Having a large credit limit may seem scary, but as long as you’re responsible and don’t plan to use it all up, then there’re no reason to refuse a credit increase offer from your credit card company. A large credit limit shows other companies that you are trustworthy and also, lowers your utilization rate. This can help increase your credit score and ensure you get approved for loans.

3. They Don’t Co-Sign Loans

Co-signing loans is a dangerous gamble. See, when you co-sign a loan, you are essentially taking responsibility, should the person you co-sign with defaults on the loan, then you are stuck with paying it back. This not only ruins your credit score, but you will have to pay back money you didn’t use in the first place.

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4. They Don’t Ignore Inflation or Rates

Savings accounts are a great way to keep your money safe, but the truth is, keeping all your money in an account that earns you less than one percent APY is one way to lose money. You’re not losing the money exactly, but you are losing its value when you consider inflation or when the cost of goods increase. Studies suggest that inflation could be anywhere between four to six percent per year, which means you have to be making at least that in interest to make sure you have enough money in the future. That said, for your future, you need to think of a way to make sure your money works for you.

For example, if you have a structured settlement, the money you get today may not have the same value in a few years. You might want to consider finding a settlement buyer. A settlement buyer is someone who purchases settlements from other people and gives them a lump sum. With a lump sum of money, you can invest in something that will earn you more money in the long run. Look around and find a settlement buyer who can offer you a good deal.

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5. They Don’t Ignore the Fine Print

Fine print is one way you can get in trouble with financial companies. Many companies are quite sneaky and put important things in fine print. For example, they might put that they can increase you interest rate if you miss a payment. That is why you need to make sure you read the fine print before you agree to anything.

Featured photo credit: Richest people via img.gmw.cn

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