Donell Edwards, Blogger
About Donell Edwards: Donell Edwards is President of CWR Media and is also founder and publisher of The College World Reporter (CWR) magazine and CWR World News & Information Service. He is also a professional speaker, freelance writer, and entrepreneur.
Know Your Money
Friday – April 3, 2015
Financial Literacy Month 2015
Protecting Your Credit
By Donell Edwards
One of our most valuable assets is our credit. However, many of us never think about how important our credit is, or the need to protect our credit when making decisions, until we have damaged or destroyed our credit. We do not educate ourselves about credit, credit cards, credit or FICO score, interest rates, annual percentage rate more commonly referred to as APR, credit statements, the impact of late payments and fees, overlimit fees and many other credit related topics. We treat credit like it is money that we have earned that we may spend however we choose, until payment for our purchases is due, then reality hits us and we realize that we were spending money that we borrowed, money that belonged to someone else, and now we must repay it.
I have long believed that the economics of money and spending should be taught in our schools. Some schools have begun teaching some basic economics, or at the least, budgeting and personal money management. According to a recent survey conducted by EverFi and Higher One, “…just 17 states mandate financial literacy education, and only six states (Colorado, Delaware, Georgia, Michigan, Missouri and Texas) require students to pass a financial management test for graduation.”
Since most schools do not teach money management, unless you happened to be one of those very fortunate people who grew up in a home where your parents understood how to manage money and passed that knowledge along to you, you are most likely among the millions of Americans who are credit card addicts who are enslaved to spending.
Poor credit makes it difficult to get loans for any major purchases like a home or a vehicle. Even if we do qualify, it puts in a high interest bracket that results in paying far more than we should. Poor credit affects our ability to rent or lease an apartment. Poor credit may even adversely affect our ability to find employment. There are all kinds of consequences for failing to protect our credit.
So, just how do we avoid wrecking our credit? We found help for those in need from the credit.com blog and the article 5 Ways You’re Accidentally Wrecking Your Credit written by Roger Berger. In this article Mr. Berger addresses the problem of accidentally wrecking our credit. Some of us don’t need any help with getting into trouble with our credit, and so doing things that may have a negative impact on our credit without really knowing the consequences is a big problem.
The five things Mr. Berger discusses are:
1. Not paying attention to your credit balances.
2. Closing accounts
3. Co-signing loans (A BIG No-No)
4. Applying for too many lines of credit
5. Not monitoring your credit scores
We really encourage you to read Mr. Berger’s article and find out if you have any of these habits and what to to about them. Here is the link to the article: 5 Ways You’re Accidentally Wrecking Your Credit.
Since this is the weekend, here are the steps to financial wellness for the next three days taken from Thirty Steps to Financial Wellness developed by Money Management International:
Did you know The FACT Act gives every consumer the right to a free credit report every year from each of the three major credit bureaus: Equifax, Experian and TransUnion? Read the steps and do the exercises.
If you have questions or need help we are just an email away. Send your questions to Info@KnowYourMoneyGlobal.com
We Would Like To Hear From You. Are There Any Brave Souls Out There Willing To Share?
If you would like to share with our readers how “bad” spending habits have affected you, anonymously or otherwise, for our upcoming special, “Confessions Of Spendaholics,” please send your experience to firstname.lastname@example.org.
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Disclaimer: I have a Bachelor of Business Administration degree but I am not a financial adviser. However, I have acquired years of knowledge about personal money management through my life experience working through my own personal finances that allows me to share that knowledge with readers of Know Your Money. The Know Your Money Blog posts written by me are my own common sense observations and opinions and are for informational use only. Although my blog includes contributions from experienced financial professionals, please make your own financial decisions based on personal research or contact a financial adviser.
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