Sneak Peek: Credit Scores – Part 1
Well we have officially entered graduation season! Students are graduating from both high schools and colleges all over the country. This is an extremely exciting time in ones life, but it can also come with lots of questions. I’ve written a book that’s specifically for high school students, college students and twenty-somethings – What Everyone Should Know About Money Before They Enter The Real World. So many of us have experienced a time where we have learned a financial principle or tool and said, “I wish I had learned that before I entered the real world”. One of these questions is in regards to credit scores.
I wanted to share with you an excerpt from my book that addresses the subject of credit scores.
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Everyone Should Know About Money Before They Enter The Real World:
Your credit score will have an impact on your life.
Credit scores are a measure of one’s ability to manage debt. The dominant credit scoring system which is used by most lenders was created by Fair Isaac. This system provides a measure of an individual’s credit worthiness and is commonly known as a FICO Score.
A credit score impacts many things. It determines whether or not you can obtain a loan. If you qualify for a loan, the credit score dictates the interest rate charged.
Credit scores also impact insurability. When you obtain auto, renter’s or homeowner’s insurance, the credit score directly impacts the insurance cost. The lower your credit score, the higher the insurance premium will cost. I have seen insurance premiums doubled because of poor credit.
Credit scores also impact the ability to obtain a cell phone contract or an apartment lease. It can affect utility connections. Utility providers usually require much larger deposits from people who have low credit scores. If you have an excellent credit score, a deposit might be waived entirely. Credit scores can even impact your ability to obtain a job.
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More about the subject of credit scores, in my next post! Stay tuned!
Learn more about the book and order your copy HERE.