Younger Doesn’t Always Equal Better

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The world is your oyster, especially when you’re young.

In your 20s, you might embark on an exciting career, or fall in love and start a family, or hop on a plane and travel the globe. Why not? This is the time to explore, adventure, and launch yourself into adulthood.

Anything is possible.

Well, not anything.

Unfortunately.

When you’re young, you have thin credit. This means:

  • You haven’t had enough time to build up your credit history.
  • You make rookie mistakes—like paying bills late—that hurt your score. A lot.
  • Your credit mix, well, stinks. Compared to someone in their 60s, you likely haven’t owned multiple houses, cars, credit cards, insurance plans, etc.
  • You’re prone to dropping into the FDIC’s subprime market. One out of three people fall into this category with a credit score of 650 or less.

Being young is great—except when it comes to credit. But, it’s okay. The past is the past. Now it’s time to look to the future, improve your score, and own the home you’ve always dreamed of. Learn more at smartwithdebt.com.

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Credit Pitfalls: Paying off credit cards

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One of the biggest credit pitfalls you might fall is closing accounts when they’re paid as agreed upon. Believe it or not, it isn’t good to close an account that’s already open and being paid as agreed.

For example, Jack has five cards, each with a $500 balance. However, only one is being used. Creditors will say, “Okay, he has $2,500 available, but he’s only using $500. That means his credit usage is good.” If Jack closes the four cards he isn’t using, creditors will say, “He has one card, and he owes $500. His credit usage stinks!”

 

Want to learn about other pitfalls and credit strategies? Go to smartwithdebt.com.

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90 Day Challenge: Improve Your Mind and Body—and Finances!

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This week, we’re kicking off our 90-Day Challenge!

The challenge is to pick an enjoyable activity and stick with it for 30, 60, or 90 days. The basic guideline is choosing an activity that’s fun, fast, and CHEAP. Reading, hiking, swimming, biking, writing—it can be just about anything as long as it doesn’t cost too much.

By taking a hike every day or reading a book each week, we set ourselves up for financial success—because we aren’t using our downtime to find random ways to spend our money. Instead, we give ourselves a healthy, enjoyable outlet to focus on.

Not only are we saving ourselves money by doing this, we’re also improving our minds, hearts, and/or bodies. Getting up and moving, learning something new, reaching a new goal—it’s all good for us! Bonus: we’re keeping money in the bank to use on more important things in life—like buying a dream home.

What are you waiting for? Give yourself a focused purpose this month, and you’ll quickly (and easily) break free of bad financial habits.

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