Why is my Credit Score Important?

A lot of people talk about the importance of having a good credit score, but why? In these modern times a good credit score is more important than ever and it’s important you have a clear understanding of what your credit score is and how it can help you. In this article I’m going to tell you how having a good credit score will help you.

1. Better interest rates

Your credit score can determine whether or not a bank will loan you money and if so, how good their interest rates will be. If your credit score is low then you may find it difficult to find a bank or credit card company who will loan you money. Even if you can find a bank or company that will lend you money then the chances are their interest rates will be very high. The better your score is, the less risk they will feel you will be to them and in return you will find it much easier to loan money and get good interest rates.

2. Having a good credit score is attractive to potential employers

It’s not just banks and credit card companies who might check your credit score. It can also be viewed by your employers who might use it as a basis of how reliable you are. Employers can’t see your precise credit score but they will be able see your credit reports so it will look better if your credit score is good. A healthy credit score could be the difference between getting your dream job or having to settle for something else.

3. A good credit score will help you get insurance

Many insurance companies use your credit score as a basis to calculate your premium. Having a bad credit score increases the premium whilst a good one will decrease it. In this regard, a low credit score could cost you money.

As you can see, a low credit score doesn’t just affect your credit cards and loans. A low score can impact your life in a variety of ways that can be detrimental. A good credit score can bring you new opportunities and open doors whilst a bad one can shut those doors.

Here are five simple tips for improving your credit score:

1. Be sure to pay your bills on time.

2. Put a limit on the number of credit applications.

3. Be as debt free as possible.

4. Get help from a financial advisor if you need it.

5. Monitor your credit score as much as you can.


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