Most of the time, tips you find for improving your credit center around checking your credit score and following some basic tips for improving it. Those strategies are mostly based on tips given out by the three major credit bureaus (who maintain the credit reports upon which those scores are calculated) and the Fair Isaac Corporation (who actually handles the formula for calculating the most common score, the FICO score).
There are a few catches, though. First, lenders are now using a more diverse set of credit scores than just FICO, and people often can’t see those scores at all. Second, identity theft is a fairly common thing and it can cause strange effects with credit scores, sometimes really adversely affecting your score and sometimes not at all. Third, manual underwriting is becoming more common, meaning that lenders are more likely to not worry about scores at all and just look at your financial situation and actual credit report directly.
What do those three things mean? The advice that’s meant solely to bump up your “credit score” might not end up having the affect you want. Most of the time, those tips will help, but they may or may not have any affect on the things you care about, like improving your likelihood of receiving loans or background checks (for jobs or apartment leases).
Given this, a much better approach is to step back and ask what exactly lenders and other people are hoping to learn from looking at your credit. What do they want to know?
They want to know that you’ll pay bills reliably. They want to know that you live up to your obligations. They want to know that, if they lend you money, they can expect with a high likelihood that you’ll pay them back. That’s the case you want to make to lenders and to others who might want to check your credit history, and information related to those things are what people are trying to extract.
So, rather than focusing on trying to maximize one credit score which lenders and others often don’t look at at all, you’re better off adopting tactics that will simply create a better credit history for you, keeping bad items and incorrect items far away.
Here are six simple things you can do to constantly improve and maintain good credit in a world of changing practices.
Pay your bills on time. Period. That is the single most effective thing you can do to keep a good credit history. Pay your bills by their due date, each and every time; if you can’t, do everything you can to never be more than 30 days late on anything, because that’s typically the threshold for a negative entry in your credit report.
If you find that you’re struggling with your bills, be proactive. Call the people you owe money to and see if you can work out something with them. Both of you are better off if you can work out a reasonable arrangement, as compared to you being unable to pay and them being unable to collect.
This may require you to change some of your personal finance habits, but if you want to have good credit, this is paramount.
Try to carry as little credit card balance from month to month as you can. This doesn’t mean “don’t use your credit card,” but what it does mean is that you shouldn’t be carrying much of a balance from month to month and you shouldn’t be approaching the credit limit on your cards.
Aim to minimize the balance you carry from month to month. During the month, try to avoid bumping up against your credit limit – ideally, you shouldn’t get anywhere close to it.
There are some rough guidelines out there as to what percentage of credit utilization is good to slightly raise a particular credit score – don’t worry about that. You’ll almost always be better off by aiming to get your credit cards paid down to the point where you’re not carrying a balance from month to month and a typical month of spending doesn’t take you anywhere close to your credit limit on any card.
At the same time, if you intend to borrow money or get a lease in the near future, maintain at least some line of credit. There is a wide variety of views on how many credit cards and other lines of credit a person should have open. Some people avoid it entirely, which ensures that they stay out of debt. Others go so far as to “churn,” opening up lots of lines of credit in order to get signup bonuses and other benefits.
Unless you don’t anticipate getting a loan, applying for a job, or signing a lease in the near future, you should aim for a middle ground. You want to maintain some open credit and use it responsibly, as discussed above. Don’t open tons of lines of credit, and don’t close anything, either. Rather, you want to appear like someone who uses a credit line responsibly, which you can’t show if you don’t have any or if you’re churning lots of them.
Which ones should you keep?
Keep your oldest credit card and the one you use most frequently open, and close the rest gradually over time. The oldest one you have is often the piece that establishes the length of your credit history, especially if you’re young. If that oldest card is the only one that you’ve had for seven years or longer, you should definitely hold onto it.
You should also winnow your credit use down to a single “main” card that you use, ideally one that offers a good bonus program that gives you some kind of reward for using it.
The other cards? Cancel them, but not all at once unless you’re sure no one will be looking at your credit for the next several months. Instead, winnow them down over time by closing ones you rarely use and centering your use over time onto a single card.
Be smart with your identity and your credit cards. Basically, don’t give out any personally identifying information unless you’re very sure of the situation. Don’t ever enter banking or credit card information over public wi-fi. Don’t click on links in your emails; rather, if you need to check on something, go to the website or app directly and log in. Don’t give your credit card number directly to any service that doesn’t have a very long reputation of being secure (Amazon is okay, but BigBadBillsOnlineBazaar.com probably isn’t).
If you do just those things, you’re cutting off most of the “low hanging fruit” of identity theft that you can control. A lot of identity theft happens because of those kinds of simple missteps, which can leave your information exposed to anyone who might want that data.
Of course, what you can’t control is the other end of the equation: banks and retailers and other large institutions who don’t properly secure their data, allowing hackers and other bad actors to access that information and do any number of things with it. What can you do against that?
Regularly check your credit reports, bank statements, and credit card statements for correctness and accuracy. When your bank statements or credit card statements come in every month, take a few minutes to run through them and make sure all of the charges are accurate. If you find something inaccurate, contact the bank or card issuer and figure out what’s going on.
Every year, check your credit report by using the FTC’s portal at annualcreditreport.com. The federal government mandates that each citizen can request a copy of their credit report from each credit bureau for free each year. Just download it, run through it, make sure everything is accurate, and contact them to report any inaccuracies.
Those two steps will go a long way to make sure that the credit data that’s shared about you is as accurate as possible and free of any misleading statements that could negatively impact your credit.
In the end, if you behave like a responsible person who keeps up with your bills, uses credit extended to you responsibly, and keeps an eye on your bills and credit report, you’ll be fine, no matter what credit scoring system a company uses or whether they manually examine your credit report. Don’t worry about “gaming” a particular credit score, as there’s a very good chance that lenders and employers won’t ever even look at it. Instead, behave in a way that results in good scores all around and a good credit report.
The post Six Simple Strategies for Improving and Maintaining Good Credit in Today’s World appeared first on The Simple Dollar.
For 5 years we have tracked every single transaction in and out of our accounts using YNAB. The results are revealing.
Hi all, I was reading a post on another sub of someone sharing their expenses for last year when it got me thinking about my own and it hit me: this month marks 5 years that my wife and I have been using YNAB! So I decided to take some time and reflect and figured I would share. By all means let me know if there are things I miss in this data!
For starters, wow what an absolute change 5 years has made and not just financially. YNAB itself brought upon us the concept of budgeting and tracking out finances when up until that point our lives had consisted of a "buy it, figure out how to pay for it later" mentality. Thankfully we were never really big spenders so we started from a decent spot. Secondly, looking at this it's relatively easy for me to see life changes along the way. From renting to mortgage, from having non-mortgage debt to having none. Life uh, finds a way.
Let's start at the top and look at total spending over the past 5 years https://imgur.com/LVlo2DY
Nearly $500k, ouch. Breaking it down further though it looks like 32% of that went to Savings which is our largest top-level category followed by Monthly bills(ouch again). Debt was a pain and everyday expenses really added up as well. Instead of looking at raw totals though I think taking a look at how things have changed over time is better https://imgur.com/geobw9v
Apologies but it looks like YNAB does not include a legend so here is what the colors mean:
- Red – Monthly bills
- Orange – Everyday Expenses
- Green(Beige?) – Savings
- Blue – Debt
A couple of trends/events I am able to pluck out of this:
- Non-mortgage debt was eliminated mid-2018(yay) meaning up until that point it was much more than a 17% expense that the totals had shown
- Monthly bills were pretty bang on until mid 2016. Correlates with a cross country move. Everyday Expenses took a beating for a couple of months as well
- Monthly expenses spiked in mid 2017 and haven't really come down. This reflects the transition from renting to owning
- Savings is highly irregular. Spikes I can mostly explain as IRA contributions.. but the more frequent minor irregularties not so much The last couple of years the bulk of the savings comes in the first couple months of a new year when contributions can be made
That provides a pretty good high-level overview, let's take a peak at the 4 different master categories individually. Starting with savings https://imgur.com/pfTyopB
Sounds about right, looks like IRA contributions have made up about 50% of the category. I'm also assuming this has some 2014 contributions in there as well given the totals. After that the totals seem to get a bit smaller with other things we have saved up for including purchasing a home, going on vacation, gifting and donating and thankfully we really haven't had to use our emergency fund all that much in the last 5 years! Woohoo. What in the world is going on with Services/appliances/Electronics though? I did a little digging and it looks like it mostly breaks down thus: * $15k landscaping and house projects * $5.5k "we bought a house now we need a washer/dryer/lawn mower etc. for it" * $5k one-time luxury purchases * $4k electronics (phone's/TV/routers etc.) * $2k furniture * $2k misc services (plumbers/chimney sweepers etc.)
I would not have guessed we spent that much on electronics. Holy hell. : Moving on to the next category: Monthly bills https://imgur.com/iaHtkvS
Right off the bat: putting a roof over our heads is expensive. To the tune of nearly 82% of the entire category over the last 5 years. Second observation.. these subcategories are all over the place. "Electricity" and "Utilities"? Oh right.. we basically got lazy sometime in 2016 and decided to stop tracking electricity and lump it in with gas/garbage/water in the "utilities" category. Looking closer at utilities:
- Nearly $4.5k is from LP.. which just began in 2017 with the home purchase. We need to switch, that's ridiculous!
- Another $1k in natural gas for the previous 2 years(MUCH CHEAPER)
- Rest mostly electric with water/trash combining for not even $50/month over the period
Nothing else too exciting about this category. Next up.. every day expenses https://imgur.com/leMPHm7
This one I'm kind of proud of. This is where I feel like we have a lot of control over our spending. Right off the bat, our largest expense is groceries consuming nearly a quarter of the entire subcategories cost. Over 5 years though, that comes out to around $400/month. Not too shabby if I do say so myself! The next highest, homegoods is a bit high for my liking as is miscellaneous but they are what they are I suppose. For our budgeting homegoods is basically things like cleaning supplies, paper products, decorations, health and beauty and so on. Misc are things like car registrations, haircuts, credit card fees, amazon prime etc. For the last year we have only budgeted $50 a month for this category, although looking at purchases from a few years ago it looks like we were just throwing random junk in here that belongs better elsewhere. Maybe I'm not so proud of this master category. Oh well, live and learn I suppose! Last observation: pets are cheap, awesome. Sub categories are clothing/work expenses/and laundry from when we used to have to go to a laundromat.
Now the last category, and my least favorite: debt https://imgur.com/bytFahV
As previously mentioned this was tracking non-mortgage debt. That came down to 2 types for us, a car loan and the dreaded student loans. Actually, I think this category is the one to be the most proud of. We paid off $70k in student loan debt in 3 years. Hell ya. I know that there was at least another $30k dent put in the 3 years before that as well. Took longer than we had hoped, but in the end it's good to have that boat anchor off of our necks. Other than that, not really much to see/say for this category.
Well.. this post got uh.. long and a bit of rambling. I apologize. I more or less did this live. A couple of big takeaways.
- Tracking your spending like this not only has the power to change your behavior and life, it also allows you to reflect on the life changes that occur and how they impact your finances. The spending over time chart is my favorite I think
- Refinement along the way is key. When you begin your budget categories may be too granular for you or not granular enough. Tweak as you go and keep moving forward
- There are always things you can do better and things you rock at. Your assumptions may not always match the facts. The way to tell is to first have the data and secondly to analyze. Short of that you're just guessing. I know I wish I had started sooner to see what the 5 years before this looked like
- Plan long term where able with your budget. This is not reflected in the numbers posted, but initially we used to plan 1-month ahead in our budget. Then we need a new car. Or furniture. Or <insert expensive thing we had not saved for over the last x months>. The result: scrambling to find the money and spiking the funding of a subcategory for that month in order to cover the expense. Now we try to plan ahead all of those purchases, even the ones that are many years out like a new vehicle so we can spread the cost out over time
- 5 years is a loooong time.
The Cheapest Renters Insurance Companies Georgia 2020
Georgia is one of the most expensive states for renters insurance, as they’re the sixth most expensive state, with premiums around $243 annually in 2017 compared to the average premium of $180 in the United States. Even with the extra cost in Georgia, renters insurance can be affordable and can save you a lot of money if something happens that would require you to use your coverage.
Find the Best Renter Insurance
Enter your ZIP code below and be sure to click at least 2-3 companies to find the very best rate.
When considering renters insurance, there are several things to consider:
- Personal property: This is the amount that covers your items should they incur damage from fire, flood, weather or other covered events
- Personal liability: Personal liability covers medical bills for anyone who’s injured in your home or on your property. It can also protect you from expenses if you’re legally responsible for damage on someone else’s property.
- Loss of use coverage: This provides financial assistance for temporary living expenses if your apartment becomes uninhabitable.
With these factors in mind, how much renters insurance do you need? This depends on the value of the items in your home. To demonstrate, if you’re a college student who doesn’t have many valuable items, you could afford to have a lower personal property amount. Or, if you have collectibles, artwork or other high-priced equipment, you’ll want more protection to cover them. Likewise, if you have a dog that might bite someone, more personal liability protection could be useful.
Best rental insurance companies in Georgia
When searching for the best renters insurance companies in Georgia, consider a provider’s reputation for delivering customer service (the J.D. Power & Associates customer satisfaction survey is a helpful resource), it’s financial strength that indicates if they can pay out claims (AM Best rating) and their price offerings. With this in mind, here are the best of the best:
- Liberty Mutual: Liberty Mutual earned top marks for its financial strength, as it rated A with AM Best. This indicates the company has strong financial health and should be able to pay its policyholders’ claims.
- Nationwide: Nationwide made the list on the strength of its customer service. That said, Nationwide tends to be a more expensive option when compared to State Farm or Liberty Mutual.
- State Farm: State Farm makes the list because they earned a five out of five rating with J.D. Power, demonstrating a high level of customer satisfaction. What’s more, when we did a quote with State Farm, it was the cheapest traditional provider available, with rates beginning at $242 annually.
- USAA: Last, but certainly not least is USAA. It’s the gold standard for insurance companies because it earned a five out of five overall in J.D. Power’s customer satisfaction ratings. USAA is also among the least expensive providers with some of the most responsive customer service. This company only serves military members and their families.
Taking these things into account, here’s how the top Georgia renters insurance companies measure up to each other:
|Provider||J.D. Power Rating||AM Best Rating||BBB Grade|
|Liberty Mutual||2 out of 5||A||A|
|Nationwide||2 out of 5||A+||A+|
|State Farm||5 out of 5||A++||A+|
|USAA||5 out of 5||A++||Not rated|
When comparing renters insurance, you will have certain things that are more important to you than others. Because of this, we want to help you in the right direction by providing the best carrier depending on your situation.
Cheapest Georgia renters insurance: State Farm
State Farm is by far the least expensive option available. When we did a quote for them using an Atlanta zip code for $20,000 in personal property coverage, we received a quote for $243 annually. If you combine this policy with an auto policy, it drops the price down to a little over $16 per month.
Best Georgia renters insurance for online options: Nationwide
Nationwide makes it simple to receive a quote within minutes. You visit the website, go to “start my quote” and fill out the required information. Nationwide also offers a mobile app where you can make changes to your policy at any time, which is a simplified way to manage your policy on the go.
Best Georgia renters insurance for customer service: USAA and State Farm
Insurance can be difficult to understand. If you don’t know what coverage you’re receiving, it helps to go with a provider that delivers exceptional customer service. This is where USAA and State Farm separate themselves from the rest of the pack, as both earned top marks in J.D. Power’s customer satisfaction survey.
Frequently asked questions
How much renters insurance do I need in Georgia?
The amount of Georgia renters insurance you need depends upon the value of the items you have. If you have more valuable items, you’ll want a bigger amount to cover you in the off chance they incur damage.
What’s the cheapest renters insurance company in Georgia?
For traditional carriers, you won’t beat State Farm. It offers the lowest rates with the highest customer satisfaction scores. If you’re in the military or have a family member who is in the military, USAA is your best bet. However, your circumstances might make some companies cheaper than others. Get several quotes and ask about discounts you might be eligible for to find the cheapest coverage.
The post The Cheapest Renters Insurance Companies Georgia 2020 appeared first on The Simple Dollar.
We Spent $68.24 at the Grocery Store This Week (+ our dinner menus)
Want to see what we bought for this week’s $70 grocery budget? I’m currently challenging myself to stick with a $70 budget for our family of five. This includes almost all of our breakfasts, lunches, snacks, and dinners + most household products (toiletries, laundry soap, etc.).
I was excited to find some great deals at Kroger, be able to stock up on a few things, and stay under budget. Here’s what we bought this week:
Kroger Shopping Trip #1:
- 4 boxes Creamette Pasta — $0.49 each with the digital coupon
- Duncan Hines Microwave Cakes (I thought these would be fun to have for a movie night) — marked down to $0.39 each
- Kroger Hashbrowns — $1.79
- Fresh Salsa — marked down to $0.99
- 1 bag of apples — marked down to $0.99
- 4 jars Kroger peanut butter — $0.99 each after digital coupon
- 1 jar natural Kroger peanut butter — $1.79
- Kroger cheese (16 oz.) — $3.99
- Pillsbury Pie Crust — marked down to $0.99
- 3-lb bag of Gala apples — $3.99
- 2 lbs ground beef — marked down to $1.99 each
- 3 bottles Odwalla juice — marked down to $0.99 each
- 2 boxes Kroger cereal — $1.49 each
- Milk — $2.79
- Half & Half — $1.99
- Total with tax: $38.38
Kroger Shopping Trip #2:
- 2 boxes Kroger cereal — $1.49 each
- Hostess Cupcake Dessert Mix — marked down to $0.39
- 2 cans Chef Boyardee — marked down to $0.19 each
- Simple Truth Refried Beans — marked down to $0.39
- 4 bags Kroger Frozen Veggies — $1 each
- Lemi-Shine Dishwasher Tabs — marked down to $0.89
- 5 packages of Pampers wipes — $0.99 each with Friday-Saturday digital coupon
- 2 Stayfree pads — $1.69 each when you buy 5 participating items, used $3/2 Kroger digital coupon = $0.19 each
- 2 Suave shampoo/conditioner — $0.99 each when you buy 5 participating items, used $1/2 Kroger digital coupon = $0.49 each
- Kellogg’s Raisin Bran — $1.79 when you buy 5 participating items
- Milk — $2.99
- Simple Truth Eggs — marked down to $1.49
- Total with tax: $29.86
Our Menu Plan This Week
Note: When you see the meals below, please remember this: I buy ahead often. Which means that when I find a great deal on something I know we’ll use, I buy as much as I can afford in our budget to have on hand.
This means that you aren’t going to see all of the groceries my shopping trip that I used to make all of the meals we ate.
Please also remember that I’m putting this out there and it’s not a perfectly balanced menu. This is just really what we ate — and I hope that it encourages you to see the real-ness and lack of perfection here.
Lunches: Leftovers, Salad, Apples/Peanut Butter, Mac & Cheese, Yogurt, Cookies, Chips, Random other markdowns/sale items 🙂
Sunday: Leftovers + Mac & Cheese
Monday: Breakfast Casserole (recipe sent to me by a follower)
Tuesday: Fend for yourself + leftovers
Wednesday: Tyson Anytizers, Broccoli, Brown Rice
Thursday: Chicken Tetrazinni, Green Beans, Bran Muffins
Friday: Pumpkin Waffles, Bacon (Jesse & I went out to dinner with a gift card we were given by his parents — we’re trying to get in some dates before the baby gets here!)
Saturday: Dinner out (Kathrynne had an out of town basketball tournament)
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