5 Ways to Get Your Finances in Shape Before the Year Ends

Everyone has those New Year’s resolutions that, even with the best intentions, seem to fall by the wayside. While it might be too late for some, there’s still plenty of time left in 2017 to fulfill your financial goals.

Courtney Lindwall, 24, an editor in New York City, says she set out at the beginning of this year to spend less money eating out. While she’s been better lately, she says she didn’t start working toward the goal right away.

“Around March, I was finally like, ‘Enough,’ and have been a little stricter about it,” she says.

In fact, mid-year is the perfect time to re-evaluate your financial situation and find new motivation for saving, says Catalina Franco-Cicero, director of financial wellness and a financial coach at Fiscal Fitness Clubs of America.

“We could all say that we get really excited at the beginning of the year,” Franco-Cicero says. “Then come summertime, we think, ‘Holy cow, I didn’t do anything. I really want to get remotivated.’”

Bruce McClary, vice president of communications for the National Foundation for Credit Counseling, says he also recommends reassessing financial goals mid-year. Making financial resolutions at the new year almost seems to “curse” them, he says, and there are many events to plan for financially in the second half of the year, such as back-to-school season and the holidays.

Here are five areas to evaluate to help you become more fiscally fit in the last half of 2017.

1. Put together a status report

You need to understand your financial situation in order to set goals for improving it. Finding the money to save or pay off debt can seem doubly daunting if you don’t know how you’re spending your money each day.

Evaluate the last six months’ worth of your expenses and income so you can plan for the rest of the year. McClary suggests reviewing the following things:

  • Your budget: Determine how much you’re spending each month on your home, car, food, and other living expenses.
  • Your debts: Make a list of all your debts, how much you owe on each one, the interest rates, and any pay schedules.
  • Your savings: Take stock of your savings accounts, including retirement accounts and emergency fund. Also think of things you would like to save for.
  • Your credit score. (If you’re not sure how, you can check out our guide to getting your free credit score.)

“Really give yourself a full picture of your financial situation so you can then go in and identify your best ways to save,” McClary says.

2. Dig into your spending habits

Once you have a high-level view of your finances, take a closer look at how you’re spending your money.

Franco-Cicero says she uses Mint, a money management tool, with her clients to help them categorize their transactions — a process people can easily turn into a habit.

Then, evaluate your discretionary spending to see what’s not necessary or where you can cut back. For example, consider reducing the amount you spend on subscription services or dining out and use the savings to pay off debt or to boost a savings account.

One thing to remember is seasonal expenses, like heating and cooling, McClary says.

“You want to make sure you’re making adjustments to your budget, while at the same time, being mindful of the expense categories that can change on a seasonal basis,” he says.

3. Reassess your credit card situation

A key step in reassessing your debt is taking a look at how much of a balance you carry on credit cards each month, how much you’re paying off each month, and how long it will take you to become debt free at that rate. You can figure this out with a credit card payoff calculator.

“Say [to yourself], ‘Hey, if I continue at the rate that I am going, will I ever be debt free?’” Franco-Cicero says.

Then create a plan to pay off your debt. McClary says the most important thing is to craft it around what motivates you the most. For example, if paying off the credit card with the highest interest rate motivates you, focus on that. If paying off the card with the lowest balance motivates you more, check that off first.

And even if it seems impossible to pay it off, he says there are benefits to chipping away at your credit card balance: Your minimum payments could go down, and using less of your credit line can help your credit score.

4. Start saving for something

We all know that we should be saving, whether it is for an emergency, retirement, or vacation. However, 23% of Americans don’t save any of their income, and only 38% report making good progress toward their savings needs, according to a 2017 survey from the Consumer Federation of America.

One of the best ways to become fiscally fit is to start saving for something that motivates you. You’re more likely to stick with saving toward a goal that you set for yourself, Franco-Cicero says.

If you don’t know where to start, she recommends a so-called “curveball” account.

“Curveball” accounts are similar to emergency funds in that they can help you cover unexpected expenses. The difference is that your “curveball” account would be used for things like replacing the worn-out tires on your car versus using your emergency fund to repair a blown transmission.

Now is also a good time to focus on saving for a house, McClary says, because you’ll have six to eight months to save before the next home-buying season. You can plan how much you need to save by looking at your existing savings, the cost of buying in your desired neighborhood, your debt-to-income ratio, and your credit standing.

No matter what you’re saving toward, McClary says an ambitious goal would be to save 20% of your monthly income between now and December.

If you make $2,000 a month after taxes, that means you would put about $400 toward savings each month. If you start in August, you could save $2,000 toward your goal by the end of the year.

5. Stick to your plan

Establishing where you are and where you want to be is only half of the battle when it comes to being fiscally fit by the end of 2017. Sticking with your action plan, as with all resolutions, can be the toughest part.

To be successful, Franco-Cicero suggests automating everything you can, from paying your bills each month to putting money into your savings account. This way, you don’t have to think about making sure a portion of your paycheck goes toward savings — your bank account will do it for you.

Franco-Cicero also says you should find a “money buddy” who knows your goals and can help you stay on track. Be sure to find someone who also has a financial goal and who will stick to a schedule so you can check in with each other. It’s a good idea to pick someone with whom you feel comfortable talking about money, not someone who you feel passes judgment on your purchases.

“We can be very lenient with ourselves, so you’ve got to find somebody who will hold you accountable,” she says.

Lindwall has had success following a similar approach. She says cooking more at home with her boyfriend has helped her stay on track toward her goal of eating out less.

“The biggest thing is getting someone else on board to do less expensive things with you,” she says.

The post 5 Ways to Get Your Finances in Shape Before the Year Ends appeared first on MagnifyMoney.

Big Changes Coming to Millions of Credit Reports in a Few Days

Millions of people could see their credit scores rise July 1.

Up to 7% of people with credit scores could see them rise beginning July 1 when credit reporting agencies will start excluding most civil judgments and about half of all tax lien data from credit reports.

As announced in March, the three major credit reporting agencies, Equifax, Experian and TransUnion, will start holding public data to new standards. After July 1, any public record data must include a consumer’s name and address, as well as their Social Security number or date of birth, to appear on their credit file, according to the Consumer Data Industry Association.

Who Is Affected?

Most people should see little impact on their credit scores, according to an analysis conducted in March by FICO, the most common provider of credit scores. About 7% of people with FICO scores, or about 15 million of the 220 million Americans with scores, will see a judgment or tax lien removed from their credit files, the analysis said.

Public records like bankruptcies, tax liens and civil judgments typically stay on credit reports for seven years, so those who see these items removed get a long-lasting weight removed from their credit scores.

However, most of the people who have items removed will experience score increases of less than 20 points, FICO said. The reason the increase isn’t greater is because 92% of people who will have tax liens or judgments removed have other negative information on their credit files. To see if the change affects you, you can check two of your credit scores free on Credit.com.

In addition to culling the public record data, the agencies also plan to update their public record information at least every 90 days.

While the credit score increase is relatively modest, it may still be enough to allow people to qualify for loans or credit reports that may have been out of reach before. Most of the people impacted had a median credit score of 565 before the change.

Twenty points above that median puts people in range of a Federal Housing Administration loan with only a 3.5% down payment. The minimum FICO score required for such a loan is 580.

The National Consumer Action Plan

Equifax, Experian and TransUnion are making the changes as part of a 2015 settlement with 31 state attorneys general who were investigating the agencies over the accuracy of credit reports. In response, the agencies launched the National Consumer Action Plan, which aims to make credit information more transparent for consumers.

In addition to the public record data, the plan also prohibits the agencies from including medical debts on credit reports until after 180 days to allow insurance payments to go through. The plan also calls for the bureaus to hire specially trained employees to deal with credit disputes and allow consumers to obtain an additional free credit report if they find an error on their free annual credit report.

Image: jacoblund

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5 Tips for Splitting Bills With Roommates

Roommates can be great. Or a nightmare. Here's how to keep your experience as positive as possible on the financial front.

There are many benefits that come with roommates: the ability to rent a larger space, share cleaning duties, and easily find friends to watch a movie with. On the other hand, sharing a space with a roommate – or roommates – is not always easy and can bring on some challenges, especially when it comes to money.

Here are some tips to help you split the bills and keep the peace.

1. Establish Ground Rules & Guidelines

Just as your lease spells out every detail, consider working together with your roommates to create some ground rules or guidelines. This is a good time to discuss exactly which expenses you will be sharing and which you will be paying for individually.

A major key for keeping the peace is making sure bills are organized. Figure out when and how bills will be collected and split each month, how they will be payed, and who is responsible for paying what amount. While this may sound obvious, too many times roommates will wait until the last minute, causing stress, tension, and possibly late bills.

2. Make a Cost Spreadsheet

Once ground rules and guidelines are created for paying the bills, make a spreadsheet outlining each expense you and your roommates will need to pay. Each expense should show details such as due dates, the amounts owed, and the person responsible for paying. It may be wise to have a monthly meeting to discuss the bills and this spreadsheet. This will make sure everyone is on the same page and no one is surprised by a bill when it’s time to pay.

3. Use Apps

There’s always an app for that! When you have large expenses, such as rent or utilities, consider using an app that can help with the math and the payments. Gone is the excuse that a roommate “doesn’t have cash” on them as Venmo can easily solve that issue. This free app lets you send money from a debit account to friends. The app also lets you request money letting your roommates know that money is due.

Another great app is Splitwise. This app lets roommates track bills, tally who paid, and send reminders so you’re never late. If a cost spreadsheet is too old-school for you, consider using an app to make paying bills easier among you and your roommates.

4. Keep Some Purchases Separate

Unless you and your roommates plan on selling everything when the time comes to move out, consider buying furniture separately. While it may sound logical to split furniture costs that you both will be using, what happens when your lease is up? Deciding who gets to keep what can be stressful and problematic. Consider making a list of furniture and electronics necessary for your place and figure out who will be responsible for each item while keeping your overall costs even.

Like furniture, groceries are another item which roommates should consider buying separately. If you love to eat fresh foods while another roommate loves frozen pizzas, splitting the costs won’t exactly be even. This also creates controversy when your roommate decides they want fresh food that day and indulges in your groceries.

5. Choose Your Roommates Wisely

Obviously you won’t want to live with someone who you’re going to constantly clean up after. You also won’t want to live with someone who will never pay their share of the bills. Doing so could end up hurting your credit, especially if they skip out and you can’t afford the rent on your own. You may want to request that they check their credit scores and you can do the same. That way you’ll know what their history of paying bills is like (you can get your credit scores for free on Credit.com).

While it may be hard to know your possible future roommate’s habits, at the very least, consider meeting with them beforehand so you can feel them out. You won’t want to be stuck in a lease with someone you’re going to regret living with.

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9 Ways to Get the Most Out of Your Credit.com Account

Here's how to use the tools at Credit.com to get your financial life in order.

Chances are if you’re reading this you’re ready to take control of your financial life. Well, we want to make sure you’re getting the information and help you need to do it. That’s why we’ve put together a list of nine ways you can make the most of your Credit.com account.

1. Download the Credit.com App

Download the Credit.com app for iPhone and get updates on your latest credit score information while you’re on the go. You’ll also have access to the latest news and information from Credit.com’s blog.

2. Begin Tracking & Improving Your Credit Scores

Included with your account is a recommended plan to improve your personal credit scores. It shows you in what areas your scores could improve and offers guidance on how to achieve an attainable goal. And if you run into problems, don’t worry. You can reset your action plan at any time so you can get guidance on your real-time credit situation.

3. Get the Latest News

Besides helping you track and improve your credit, our credit experts offer regular articles on ways to cut back on your spending, get better terms on your credit cards, save money on a wide variety of everyday purchases and more. You can check the latest news on our app or on our website.

4. Follow Us on Facebook & Twitter

Beyond our daily articles, you’ll get bonus information through our Facebook and Twitter pages. And be sure to watch for our live chats on Twitter where we discuss a variety of financial topics.

5. Use Our Financial Tools

Want to know how long it will take you to pay down your credit card debt? We have a calculator for that. We also have financial tools to help you figure out the lifetime cost of your debt and how much house you can afford.

6. Get Help Fixing Your Credit

Is your credit in need of some professional help? Not sure if it is? Check out the free consultation provided by our partner Lexington Law. You can also look at getting help from a credit repair company, like our partner CreditRepair.com. Lexington Law and CreditRepair.com also have iPhone and Android apps.

7. Use Our Interactive Calculators

We’re not just about helping you improve your credit, we’re also here to help you find the best rates and terms for your particular credit standing. Whether you’re looking for a personal loan, a mortgage loan or even student loans, our tools can help you find the right product to fit your needs.

8. Compare Credit Cards

Finding the right credit card can be daunting. That’s why we’ve compiled numerous expert guides for helping you choose which cards are right for you. Do you need a rewards card? A balance transfer card? Which cards do you even qualify for? We provide you with answers so you’ll know what to look for when applying, and offer tips for the application process.

9. Ask Us Questions

Our credit experts genuinely want to help you get the guidance you need. Something isn’t clear? You want further information? Ask your question on Twitter, our Facebook page or in the comments section of our blog articles.

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3 Things You Must Do Before You Lease a Car

Three Things You Must Do Before You Lease a Car

I tend to drive my cars until they die, and a couple of years ago that’s what happened. In need of a new car, but not sure what I wanted for the long-term, I considered leasing a vehicle. But if buying and financing a car seemed confusing, leasing seemed even more overwhelming. I ended up buying instead.

Turns out, though, that while leasing isn’t for everyone, it can have some advantages. Lower monthly payments and more flexible credit score requirements may be two of them.

If you are thinking about leasing, here are three things you can do to help improve your chances of getting approved.

1. Check Your Credit

Your credit score plays a key role in the lease you get. “There are going to be different tiers of credit that will be evaluated,” said Scot Hall, Executive Vice President of WantALease.com, an online marketplace for new lease deals. “If you have better credit, you will get better rates unless it’s a dealer-subsidized lease.”

Checking your credit reports at least a month before you plan to start shopping is ideal, since that will give you time to dispute and fix mistakes. While you are at it, check your free credit scores as well (you can access two of your scores free on Credit.com). You will get an idea of where you stand and whether there are potential issues with your credit.

What kind of credit scores are required to qualify for a lease? “(If) you do have good credit it really unlocks the door to the best lease deals. You’ll be able to take advantage of some of the lease specials,” said Edmunds.com Consumer Advice Editor Ron Montoya.

In addition, it may be easier to qualify for a lease than a loan on certain vehicles, at least when it comes to your credit scores. The make and model of the vehicle you choose will also affect your options. Experian Automotive found, for example, that the average credit score of someone who took out a loan for a new Jetta in the fourth quarter of 2014 was 716, while the average credit score for someone leasing one was 692. But for someone driving a new Grand Cherokee, the average credit score for a loan borrower was 735, while the average credit score for a lessee was 728.

average credit score

2. Know Your Cash Flow

One of the distinct advantages of leasing is that it may allow you to pay less per month than if you financed the same vehicle. According to Experian Automotive, the average monthly payment for a new lease was $420 in the fourth quarter of 2013, and the majority of leases (66%) were for a 24- to 36-month term.

But your lease payments may be lower than a loan payment for a similar vehicle. For example, the average lease payment for a Jetta was $287 while the average loan payment was $389. And for a Grand Cherokee, the loan payment averaged $611, compared to $470 for the lease payment.

average payment

Keep in mind that these monthly payments don’t take down payment or trade-in into account. And if you lease, you’ll either have to turn in the vehicle or purchase it when the lease term is up. “Consumers need to fully understand any potential cost on the back-end and be sure they can meet the terms of the lease – such as mileage limits and wear and tear,” said Melinda Zabritski, senior director of automotive credit for Experian Automotive.

3. Don’t Just Shop for a Car, Shop for a Lease

Unlike auto loans (which are available from a variety of sources including banks, credit unions, dealers and even online), leases today are largely controlled by the manufacturer. “Nearly all leases are done on a captive basis,” said Hall. For example, “Ford Motor Credit Company does most of the leases for Ford vehicles.”

That means you may be able to get a better deal if you are flexible and willing to consider a vehicle from a different manufacturer.

In addition to credit, the company offering the financing looks at your debt-to-income ratio and the “lease-to-value” ratio – in other words, how much you are financing compared to the value of the vehicle, said Hall. If you are having trouble qualifying, you may need to put additional money down or get a co-signer, he adds.

The good news is most people who apply for a lease qualify for one. Lease approval rates during the month of January were above 70%, according to SwapALease.com. Though that’s down from 73% in December of 2013, it’s up from September 2013 when a little more than 62% of applications were approved.

And there’s still another option: If you’re not ready to commit to a two- or three-year lease, you can consider taking over the remaining term on someone else’s lease. As long as your credit is in the same “tier” or better than the person whose lease you are assuming, you shouldn’t have much trouble qualifying, says Hall. Sites like SwapALease.com and LeaseTrader.com help bring together consumers who want to get out of leases and those who want to assume one and allow you to try out leasing without a longer-term commitment.

Image: Len44ik

This article has been updated. It originally ran on March 20, 2014.

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Here’s How Many People Actually Have the Worst Credit Score

It is possible to have a rock-bottom credit score. Find out exactly how many U.S. residents meet this dubious threshold.

As confusing as credit scores can be, most people get the basic concept: You want a high score, not a low one. What qualifies as a good credit score depends on the scoring model you’re talking about (and there are dozens of them), but a common range is 300 to 850. The higher your score, the better. You don’t have to aim for an 850 to get the best terms on a loan or qualify for top-tier credit cards, but anywhere in the high 700s is a good place to be.

Ideally, you’re not anywhere near the bottom of the range, but it is possible to have a 300 credit score on a 300 to 850 scale. The good news: A very small portion of the population has such a score. The bad news: Some people do.

How Many People Have the Worst Credit Score?

There are 294 million “scoreable” consumers, and only 0.01% of them had a 300 credit score, according to data credit bureau TransUnion pulled for Credit.com in March 2017. (A scoreable consumer is someone with enough information in their credit files to generate a VantageScore 3.0. TransUnion said 4.28% of the population is not scoreable.) While 0.01% is a really small portion of consumers, it still means 29,400 people have the worst credit score (on the VantageScore 3.0 scale). In other words: It’s totally possible for your credit to hit rock-bottom. (You can see where you stand by getting two of your credit scores for free on Credit.com.)

 

Though it’s uncommon to have the worst credit score, having bad credit isn’t. More than a quarter (27.66%) of consumers have a credit score between 300 and 600, which is considered bad credit or subprime credit. Conversely, 20% have a super prime credit score (781 to 850). The average credit score was 645 when TransUnion pulled the data.

How to Deal With Terrible Credit

TransUnion didn’t identify common factors among consumers with a 300 credit score, but they pointed out some characteristics of subprime credit files: “Generally speaking people with poor credit (300-600 score) usually make late payments, only contribute the minimum amount, carry high percentage balances on multiple cards and apply for multiple lines of credit within a short period of time,” said Sarah Kossek, a spokeswoman for TransUnion, noting that the factors vary by individual.

So if you want to avoid joining the population of people with bad credit (or you want to get out of the club), it’s smart to make credit card and loan payments on time, pay down your debts, use a very small portion of your credit card limits and apply for credit sparingly. It’s also a good idea to regularly review your credit reports for accuracy, as errors may be hurting your credit. You can pull your credit reports for free each year at AnnualCreditReport.com.

If your credit is the worst, figuratively or literally, well, you can find a full explainer on how to fix it right here.

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How to Fix the Big Things You Hate About Your Credit Cards

reasons-people-hate-credit-cards

Credit cards may be in the wallets of most Americans, but not everyone is happy with their travel companion.

The Consumer Financial Protection Bureau (CFPB) released its monthly snapshot of consumer complaints in the financial services industry this week. The report, which regularly focuses on a different financial product to highlight consumer complaint trends, focused on credit cards and what irks consumers about their plastic friends (or foes, depending on how you view it).

Credit cards represent only about 10% of total complaints to the CFPB, a small amount considering how prevalent the cards are in Americans’ daily routine. That puts them in fourth for the most complained-about financial products, behind debt collection, credit reporting and mortgages.

Here are four of the major credit card complaints that surfaced in the bureau’s review.

1. Disputes Over Fraudulent Charges

Billing disputes were number one on the CFPB’s top credit card complaint list. Of the nearly 100,000 complaints the CFPB analyzed, 17% were over billing disputes. Credit cards often offer purchase protections and chargebacks — tools consumers can use to combat faulty merchandise or high prices — and these tools are rarely offered by debit cards and never offered by cash. But fraud seems to be the source of most complaints, as consumers finding fraudulent charges cite trouble removing or getting re-billed for them.

How to Avoid It: The best way to keep yourself from having to dispute fraudulent charges is to keep your credit card information as safe as possible from fraudsters. Never share your credit card with shady sites that don’t have a “lock” symbol or https:// when taking your data. And even though it’s convenient, avoid letting shopping websites “remember” your credit card info for next time. While some of those sites have excellent security, data breaches are becoming more and more common and credit card info is a literal gold mine for a hacker. (To keep an eye out for signs of identity theft, you can view your free credit report summary on Credit.com.)

2. Rewards Program Murkiness

If you’ve ever owned a rewards credit card, you know that to make the most of your card’s program, you need to read up on all the details (and those details do change). The CFPB found that confusion over how a credit card rewards program works was sometimes attributed to differences between what consumers encountered online and what they were told by customer service representatives over the phone.

How to Avoid It: The CARD Act of 2009 did a lot to make credit cards more consumer-friendly, but little regulation pertained to rewards programs specifically and business credit cards were not included at all in the act’s purview. That means you need to be a careful shopper, as you should be with all financial products — mortgages, business loans, you name it. Before you sign up for a rewards credit card, read the rewards terms carefully — they are often in a separate piece of paperwork from the APR and fee disclosures.

3. Being a Victim of Fraud/Identity Theft

Identity theft/fraud/embezzlement as a category came in third on the CFPB’s list at 10% of all credit card complaints. Many complaints pertained to account activity that the cardholder didn’t initiate, the report said. It points back to that top complaint of fraudulent charges as well — fraud is a problem for consumers as well as credit card issuers too.

How to Avoid It: In addition to keeping your credit card information safe (see tip #1), keep your identifying information safe. To open a new credit card in your name, a fraudster would need to have access to your Social Security number, name, address and other details. Protect that info and you limit your chance of getting got. And because “embezzlement” is included in this category as well, business owners should be sure to have a policy in place if they’re extending a company credit card to an employee. The rules should be clear so you don’t have to go through the painful process of disputing charges with your issuer.

4. Trouble Closing/Canceling an Account

Even though closing a credit card can do some credit score damage, it doesn’t stop consumers who want to avoid the temptation of spending too much or just have too many cards to manage. Roughly 7% of the CFPB’s credit card complaints pertained to consumers struggling to close accounts.

How to Avoid It: Call your issuer directly (you normally have a number on the back of your credit card) and ask to close the account. Be ready though — you’ll most likely be transferred to a department that is specifically going to try to keep you as a customer, perhaps offering a lower APR or a waived annual fee for that year. (Some consumers use this as a tactic to get a better credit card, in fact.) If you’re adamant on closing the card, just stick with your plan and make sure to monitor your email or mail for your last statement. You don’t want to miss the last payment on your card and put a black mark on your credit report just because you thought the card was closed. A credit card with a positive payment history, even though it’s closed, can still help your credit score. But missing a payment will definitely hurt it, and if you have a business credit card, it could impact not just your personal credit, but your business credit scores as well. You can find a full explainer on canceling credit cards right here.

Image: Anchiy

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4 Ways Your Credit Card Can Help You Build Credit (For Real)

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For plenty of people — and millennials especially — a credit card is a scary prospect. And we get why: Phenomenal spending power plus itty-bitty charging restrictions equals a major opportunity to go into debt.

But if you’re foregoing credit cards completely, you could be making it harder on yourself when it comes to another important facet of your finances: building a solid credit score. That’s because credit cards are fairly easy to qualify for — there’s actually a whole category of them designed specifically for people who need to build or rebuild. (You can monitor your progress by viewing two of your credit scores for free on Credit.com.)

Plus, while installment loans (think auto loan or mortgage) come with an automatic price tag and, more often than not, automatic interest, you don’t need to take on debt to build credit with a credit card. That’s actually a common misconception, but, trust us, no balance here required.

To help you how to best leverage your plastic, here are four ways a credit card can help you build credit.

1. You’ll Establish a Payment History

And that’s the number one most important factor when it comes to credit scores. Of course, to build good credit, you’ll want to make all of your credit card payments on-time. (One misstep can really cost you and your score.) To avoid any blemishes, set up alerts that reminds you when your due date approaches or even consider setting up auto-payments each month. Just be sure to keep an eye on your statements for any errors or fraudulent charges.

2. Its Limit Can Bolster Your Credit Utilization Rate

That’s how much debt you’re carrying versus your total credit. Experts generally recommend keeping your credit utilization below at least 30% and ideally 10% of your total available limit(s) — which is easier to do when you have a credit card you’re consistently paying off in full.

3. Your Credit Will Start to Age

And that’s a good thing because length of credit history accounts for about 15% of your credit scores. Length of credit history, also referred to as the age of your credit, is essentially how long you’ve had your credit lines. When it comes to building credit in this category, there’s little credit newbies can do, except, you know, wait. But because a credit card represents one of the easier points of entry into the financing world, that plastic in your wallet can help you get started.

4. You Could Be Rewarded for Having a Mix of Accounts

Credit scoring models like to see that you can manage different types of credit. So, if you’ve got an installment loan on your file — like, say, that student loan you took out to pay for college — adding a revolving line of credit, like a credit card or home equity line of credit, could improve your performance in this key credit category. Mix of accounts, or credit mix, accounts for roughly 10% of the points in your credit score.

Of course, there are ways to build credit outside of simply using your own credit card. That includes looking into credit-builder loans at your local bank or credit union or becoming an authorized user on a friend or family member’s credit card. (The account will appear on your credit file and bolster your performance in the aforementioned credit scoring categories, but you won’t be liable for the charges.) And if your credit is kind of shoddy, you can try disputing any errors on your credit report, limiting credit inquiries and addressing accounts in default. You can find a full 11 ways to improve your credit scores here.

Got a credit score question? Ask away in the comments section and one of our experts will try to help!

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9 Signs You’re on Your Way to a Perfect Credit Score

Because we get it: Sometimes you just have to have that A-plus.

Hey, there, overachiever. Are you really trying to attain a perfect credit score? Here’s the thing: You don’t need to. Any score over 760 will pretty much net you a lender’s best rates and terms. Plus, even if you do score that elusive 850, you probably won’t keep it for long. Credit scores are mercurial: They change as new information hits your credit report or, most notably, as your loan balances go up and down. (Translation: Perfection is fleeting.)

But we get it. Sometimes you need that A-plus. So, in the interest of indulging your financial dreams, here are nine signs you could one day see a perfect credit score.

1. You’ve Never Missed a Loan or Credit Card Payment …

Payment history is the most important factor of credit scores, accounting for 35% of most popular scoring models. Plus, one little slip can do big damage once it hits your credit report — and it can stay on record for up to seven years. In other words: Don’t expect to see the highest score ever if you’ve missed a payment (or two) in that time frame.

2. … Or Any Other Bill’s Due Date for That Matter

Sure, utility companies, doctors, gyms and other service providers don’t routinely report missed payments to the credit bureaus, but collection agencies do. And, if you leave any old bill unattended long enough, that’s where the debt might end up, with a credit score fall to follow.

3. Your Debt Levels Are Virtually Non-Existent

The rule you commonly hear involves keeping the amount of debt you owe below at least 30% and ideally 10% of your total credit limit(s), particularly when we’re talking credit cards. If you’re trying to achieve credit perfection, you’ll want to focus on the ideal part.

Expert Intel: It’s a bit of a misnomer that you need to carry debt to build credit — you simply need to have credit accounts on the books that are being managed responsibly. So, for instance, someone could conceivably build a good credit score with a single credit card they pay off in full each month. People with 850s tend to have more than one loan on the books (more on this in a minute), but you’ll be best served in the long run by adding financing as you truly need (and can afford) it.

4. You’ve Had Good Credit for a While …

There’s a reason older demographics tend to have higher credit scores: Credit history, or the length of time you’ve been responsibly using credit, accounts for 15% of most scores. Technically, though, this category doesn’t have anything to do with your age. Instead, your credit history “starts” when you open your first credit account.

5. … But Haven’t Applied for Any New Loans Recently

That’ll boost your credit history, which also factors in the average age of your credit accounts. Plus, loan applications generate credit inquiries, which can ding your score for up to one year and hang out on your credit report for up to two. (More on how long stuff stays on your credit report here.)

6. You’ve Got a Mix of Credit Accounts on the Books

Credit scores give you maximum points for responsibly managing different types of credit. That’s why having, say, a mortgage, an auto loan and a credit card (or two) — all in good standing — tends to be a common characteristic of people in the 850 club. In technical terms, this means you have revolving lines of credit, like a credit card, and an installment loan, like that mortgage, on the books.

7. Your Public Record Is Clean

Judgments and liens can wind up on your credit file, though there are indications that will soon be changing. For now, though, a matter of public record could wind up hurting your credit score.

8. Your Credit Report Is Error-Free

Credit report errors can happen for a number of reasons and most misinformation will needlessly harm your credit. To achieve perfection, your file needs to be pristine — which you can help to ensure by diligently pulling your free annual credit reports from each major credit reporting agency and disputing any error you see.

9. You Keep a Compulsive Eye on Your Standing

You know the old adage “if a tree falls in a forest and no one’s around to hear it, does it make a sound?” Well, the same can be said about an 850 credit score. You’ve got to play all your credit cards right, and then you’ve got to be lucky enough to check your score at the precise moment perfection strikes. (Like we said earlier, that 850 probably isn’t going to stick around for long.) Fortunately, you can view two of your free credit scores, updated every 14 days, on Credit.com.

Image: m-imagephotography

The post 9 Signs You’re on Your Way to a Perfect Credit Score appeared first on Credit.com.

Are Fast Cars More Expensive to Insure?

Are fast cars more expensive to insure? Not quite, and here's why.

Even just a decade ago, cars weren’t nearly as fast as they are today. In fact, 300 horsepower was expected only from V-8 engines, writes Forbes. But because of “direct fuel injection, turbocharging and other advances in engine technology and design, power and speed can be bought in a range of body styles, vehicle sizes and powertrain configurations.”

Speed — as measured by quickness of acceleration and pure engine power, and not top speed, which only matters on race tracks — is now more accessible than ever, and as Tesla just proved, as cars move to electric power, we might see faster and faster cars on the road. Tesla’s Model S is now the third fastest car in the world, writes The Verge (behind just the Ferrari LaFerrari and the Porsche 918 Spyder — both million-dollar hypercars). Upgrades to the battery allow the Model S to go from 0 to 60 mph in 2.5 seconds, making us wonder: Do the fastest cars cost more to insure?

We looked at cars people might actually drive (we’ll save concept cars and supercars for another list and another day) and calculated insurance premiums based on a standard profile: a 30-year-old single man living in Austin, Texas (ZIP: 78702), who rents his home, owns his car, has a good driving history, a good credit score, and has had consistent insurance coverage for a basic level of insurance with a national carrier. (You can view two of your credit scores, with helpful updates every two weeks, for free on Credit.com.)

Keep in mind, the time it takes for a car to accelerate from 0 to 60 mph can vary widely based on each driver’s skill, so results may vary. In no particular order (because their specs and model years differ), here are 10 of the fastest cars on the road and their stats.

1. 2017 Chevrolet Camaro
MSRP: $37,900
Engine Details: 6.2-liter V8, 455 horsepower
Acceleration Speed: 0-60 in 4.0 seconds
Average Yearly Insurance Premium for a Chevy Camaro: $1,620

2. 2016 Jaguar XJR
MSRP: $118,000
Engine Details: 5.0 Liter V8 550 HP Supercharged
Acceleration Speed: 0-60 in 4.4 seconds
Average Insurance Premium: $2,148

3. 2017 Cadillac CTS-V
MSRP: $85,995
Engine Details: 6.2-liter V, 640 horsepower
Acceleration Speed: 0-60, 3.7 seconds
Average Yearly Insurance Premium: $2,112

4. 2016 BMW M5
MSRP: $94,100
Engine Details: 4.4-liter V8 TwinPower Turbo, 560 horsepower
Acceleration Speed: 0-60 in 4.2 seconds
Average Yearly Insurance Premium: $2,112

5. 2016 Dodge Charger SRT Hellcat
MSRP: $67,645
Engine Details: 6.2-liter supercharged Hemi V8, 707 horsepower
Acceleration Speed: 0-60 in 3.7 seconds
Average Yearly Insurance Premium: $1,512

6. 2017 Audi RS 7
Engine Details: 4.0-liter V8 with two turbochargers, 560 horsepower
MSRP: $110,700
Acceleration Speed: 0-60 in 3.7 seconds
Average Yearly Insurance Premium: $2,268

7. 2017 Volkswagen Golf R
MSRP: $39,375
Engine Details: 4-cylinder turbo, 292 horsepower
Acceleration Speed: 0-60 in 4.5 seconds
Average Yearly Insurance Premium: $1,560

8. 2017 Ford Mustang GT Fastback
MSRP: $33,195
Engine Details: 5.0-liter V8, 435 horsepower
Acceleration Speed: 0-60 in the mid-4 second range
Average Yearly Insurance Premium: $1,512

9. 2016 Dodge Challenger R/T Scat Pack
MSRP: $39,995
Engine Details: 6.4-liter V8, 485 horsepower
Acceleration Speed: 0-60 in the low-4 second range
Average Yearly Insurance Premium: $1,608

10) 2017 Volvo S60 Polestar
MSRP: $60,000
Engine Details: 3.0-liter Turbocharged inline 6-cylinder 345 horsepower
Acceleration Speed: 0-60 in 4.7 seconds
Average Yearly Insurance Premium: $1,428

Compare these insurance prices with the prices of the five most popular sedans for 2017, based on our new State of Auto Insurance Report, for the same insurance customer profile.

Chevrolet Cruze
MSRP: $16,975
Acceleration Speed: 0-60 in 7.6 seconds
Average Yearly Insurance Premium: $1,056

Honda Accord
MSRP: $22,455
Acceleration Speed: 0-60 in 6.1 seconds
Average Yearly Insurance Premium: $1,176

Hyundai Elantra SE
MSRP: $17,150
Acceleration Speed: 0-60 in 8 seconds
Average Yearly Insurance Premium: $1,344

Nissan Altima
MSRP: $22,500
Acceleration Speed: 0-60 in 7.7 seconds
Average Yearly Insurance Premium: $1,260

Toyota Camry
MSRP: $23,070
Acceleration Speed: 0-60 in 8 seconds
Average Yearly Insurance Premium: $1,236

Final Word: Do Fast Cars Cost More to Insure?

Our assessment: We can’t say for sure whether or not all cars with more powerful engines that can accelerate faster always cost more to insure than their slower counterparts, but all of the faster cars above come with more expensive insurance premiums than all of the slower cars we looked at.

Another potential insurance price factor: All of the faster cars also cost more (in some cases, a lot more) than all of the slower cars. We know that price has something – though not everything – to do with insurance pricing (which is still somewhat of a mystery, even to us).

As we’ve seen, equating insurance rates with one definable feature is tough: Insurance rates weren’t strictly correlated with safety rating, either. But while we might not be able to say with absolute certainty that faster cars will mean more on your monthly premium, we do have proof that using that speed illegally is practically guaranteed to cost you.

The Insurance Consequences of Speeding Convictions

If you drive a certifiably fast car, always remember to follow the rules of the road, not only because it’s safer for you and everyone driving near you, but because beyond any traffic citations you might receive for speeding, speeding also has some pretty detrimental effects on insurance rates.

In 2016, if you were convicted of speeding, your insurance rates went up by the following percentages (national U.S. averages from The Zebra’s State of Auto Insurance Report):

  • Speeding in a School Zone: 18%
  • Speeding 6-10 MPH over the limit: 17%
  • Speeding 11-15 MPH over the limit: 18%
  • Speeding 16-20 MPH over the limit: 19%
  • Speeding 21-25 MPH over the limit: 20%
  • Speeding In 65 MPH Zone: 23%

That means if we’re looking at the national average premium of $1,323, a single speeding ticket could raise your rates from $225 to $304. (And that continues for three years after the violation occurs.)

Fast cars with great handling make for excellent driving – but stay safe (and under the speed limit!) – or you could pay in more ways than one.

Image: mevans

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