What if you were able to come out of this time of social distancing and economic crisis with a stronger and healthier financial life? What if you looked at this as an opportunity to take a little bit of your extra time each day to work on your finances?
Credit Report
5 Easy Personal Finance Wins for the New Year
7 minute read
“If you haven’t started, then taking action is more important than finding the best strategy. If you’re already taking action, then ensuring you’re working on the right thing is more important than working harder.” – James Clear, Atomic Habits
Halfway Through 2019
3 minute read
Somehow, we’re already halfway through the year. I have no idea how that happened, but it did and there are some things that we can do now to evaluate our progress towards our goals, and get ourselves back on track if we need to, that will help to set us up for success over the next 6 months to end the year strong.
Equifax Data Breach
3 minute read
Hopefully we haven’t forgotten about the Equifax data breach due to the severity of the potential outcomes. The Equifax data breach happened over a year ago on September 8, 2017. The breach exposed sensitive data of 146 million consumers and most American’s Social Security numbers were compromised.
This should concern you.
Personally, I think it’s a pretty big deal that some extremely smart person with very bad intentions probably has copies of my passport, driver’s license, and Social Security number. Just image the things they could do with that.
If you didn’t take action after the data breach, there are still a couple of things that you can (need to) do.
Lock Your Credit Reports
Locking your credit reports prohibits lenders from accessing them which means that lenders won’t open lines of credit in your name. If your credit reports aren’t locked, then someone with the right information could fraudulently open a line of credit such as a mortgage or credit card in your name and wreak havoc on your credit.
You should lock your credit reports with at least the 3 major credit reporting bureaus. You can lock your report with Equifax by creating a myEquifax account here, adding a security freeze to your Experian credit report here, and creating a TransUnion account to add a freeze here.
What if someone does it before you and you’re not able to access these accounts? (Hint: That would be very bad.)
Make sure that you save any passwords/PINs that you’re required to create in a very secure place. This isn’t information that you want to write down on your password paper that you keep in your wallet or at your computer desk or anywhere else that it could potentially end up in someone else’s hands. You’ll need these passwords and PINs to access your accounts when you want to place temporary credit freeze lifts which allow lenders to access your reports when you’re applying for credit.
This also means that you;ll have to remember to temporarily lift the freezes when you apply for a mortgage, car loan, or credit card.
Check Your Credit Report On A Regular Basis
Everyone is eligible to receive one free credit report from each of the three major credit reporting bureaus once per year from annualcreditreport.com (this is the government verified website for accessing credit reports). That’s three free credit reports per year. A good strategy is to pull a report from one of the bureaus every four months to make sure that you’re keeping up with your credit report and ensure that nothing looks wrong on it. For example, you could pull one from Equifax in January, one from Experian in May, and one from TransUnion in September.
When reviewing your credit report, make sure that everything is accurate: your personal information, your credit information, public records such as bankruptcies, foreclosures, and lawsuits, and inquiries on your report. If you see anything that isn’t correct, or seems out of the ordinary, you can call the credit reporting bureau to speak about it and to file a dispute, if you need to.
Creating these accounts and placing credit freezes is a time-consuming process and may seem like it’s not worth it at the time. However, putting in a little effort now could potentially save you a ton of time, money, and heartache in the long run. Repairing credit can take a long time and can be extremely costly. Help yourself avoid having to go through doing so by taking preventative measures now. It’s likely that your personal information has been compromised and checking your credit reports on a regular basis can help you catch fraudulent activity.
Financial Spring Cleaning
< 1 minute read
It’s the first day of spring which means it’s time to start thinking about financial spring cleaning.
I bet if you go through with it you’ll find yourself in a better financial position and you’ll feel good about what you accomplished.
Here are some things to consider:
- Set financial goals for the rest of the year
- Reevaluate or get started using a budget
- Increase your savings to your retirement plan by 1% – you’ll never notice it’s not in your paycheck
- Increase the amount that you’re paying monthly on your debt
- Shop for better insurance rates – use an independent insurance broker rather than a big-name insurance company
- Pull a credit report if you haven’t already this year and make sure that nothing looks off
- Cancel unused memberships and subscription services
- Start planning now for summer travel costs
- Plan for summer home projects & yard maintenance
- Have a yard sale and get rid of all the stuff laying around your house that you don’t use
What’s a credit score and why do I care?
< 1 minute read
What is a credit score and why do I care about it?
A credit score is a reflection of your personal credit history. It is a measure that lenders use to determine the likelihood that you will pay back your loan and is part of the information that they use to determine whether to give you a loan. A credit score is not the same thing as a credit report.
The picture shows that FICO credit scores range from 350 to 850 (850 being a low risk to the lender) and how a lender may view these scores. Your individual credit score may be a different number from each of the credit bureaus (Equifax, Experian, TransUnion) because they each have different evaluation criteria.
It’s important to know your credit score because lenders use it when evaluating whether to give you a loan. If you want to purchase a house or a car using a loan and you have a low credit score, then lenders may give you a loan with a high interest rate in an attempt to hedge the risk that you will not repay your loan.
What’s a Credit Freeze?
< 1 minute read
Alright, so the picture isn’t exactly it.
A credit freeze allows you to block access to your credit report. This can be a useful tool as many lenders may not extend a line of credit in your name if they’re not able to access your credit report which can help to make sure that someone doesn’t fraudulently open a line of credit using your information.
Credit freezes can be placed by creating accounts with each of the major credit reporting bureaus (Equifax, Experian, TransUnion) or by calling the bureaus. When you place a credit freeze you will receive a PIN or password that you will need to keep in a safe place. You will use this PIN or password if you need to temporarily lift the credit freeze. There may be a small fee for placing and lifting a credit freeze.
If you’re planning on doing something which requires your credit report to be pulled (taking out a loan, applying for a credit card, sometimes applying for a job if the employer pulls a report, etc.), then you have to make sure to temporarily lift your credit freeze.
When was the last time you pulled your credit report?
< 1 minute read
Your credit report details your credit history and any lines of credit (student loan, mortgage, vehicle loan, credit card, etc.) that have been opened in your name. Lenders use these reports in their processes to determine if you are worthy to be approved for the loan that you’re applying for and what interest rate to offer you.
With the data hacks that took place or were disclosed in 2017 (most notably Equifax and Yahoo!) it is becoming more and more important to ensure that your identity hasn’t been stolen and that someone hasn’t opened a line of credit in your name.
How do you do this?
You are entitled to one free credit report from each of the 3 major credit reporting bureaus (Equifax, Experian, TransUnion) once per year via annualcreditreport.com. You can pull your credit report from the website and check for any discrepancies.
Drew’s Method:
I pull my credit report in January, May, and September. Each time I pull the report I pull from a different credit bureau. Eg. January pull from Equifax, May pull from Experian, September pull from TransUnion. This way, I’m able to check my report throughout the year and never have to pay for it.
