An excellent credit score is simply a must for one to live comfortably. Even if you don’t have insane amounts of savings, having a good credit score enables you to access the luxuries of life that would otherwise be extremely difficult to attain. It is a long a tedious project to get you credit score to a satisfactory level; here are some tips on how to stay on top of your credit card game.
These are the five upgrades you must immediately put on your agenda if you are at 740 (or almost nearing) credit score.
Your Credit Card
More than often, your banks reserve some exciting perks for customers with excellent credit scores. Reward points for travelling purposes (and more), better interest rates, increased credit limit, insurance programs, and concierge services are some noteworthy perks. Remember, you are upgrading your credit card – not closing a major credit line and replacing!
Also, just because you now qualify for a myriad of credit cards does not mean you must have them all, your score with take a big hit if you open too many lines in a short period of time.
Refinance your home
Mortgage rates have gone down significantly lower (although rising again slightly) than they were about a decade or so ago. If you have a long way to go with your payments, then refinancing may serve to be an attractive option; the rates will be even more pleasant because of your fantastic credit score.
Yes, you will be extending your payments for the next 30 years or so, but you don’t have to comply by the bank’s intentions. Even though your new monthly payment will be lesser, you can continue to pay the amount you currently pay. This way you’ll finish up paying off the loan at a faster pace and save a huge amount on interest.
Do a Balance Transfer
NerdWallet analysis from December 2014 showed that the average American household carries a credit card debt of $15,611. The worst part about credit card debt is the ever haunting double digit interest rate. Your excellent credit score can qualify you for a balance transfer to an account that could have a zero interest feature for a set duration of time. This will allow you to rid your burden faster and save a bunch of money on interest.
It should be kept in mind that banks charge a small percentage (3-5%) when opening a new account to transfer debt into; ask if this could be waived!
Time For New Insurance!
An excellent score also makes you eligible for better insurance rates. Believe it or not, most insurers do take your credit score into account to determine your risk and to see how likely you’ll file a claim – this is called credit based insurance score; the practice is banned in Massachusetts, Hawaii, and California.
According to Esurance.com,
“To establish eligibility for payment plans and to help determine insurance rates, most U.S. insurance companies, including Esurance, use credit-based insurance scores, along with your driving history, claims history, and many other factors….. If you have a high credit-based insurance score, an excellent driving history, and zero claims on your record, you’ll qualify for low rates.”
Interestingly, they also state that,
“While the reasons why are less than crystal clear, research shows that credit scores can accurately predict accident potential. Statistical analysis shows that those with higher credit scores tend to get into fewer accidents and cost insurance companies less than their lower-scoring counterparts.”
Your Apartment
Why settle for a mediocre living space when you have just expanded you options; an excellent credit score makes you a very attractive applicant.
Your credit score is quite influential in what kind of place you can rent; like insurance companies, landlords also review your credit score to weigh your risk. With a good score, this will almost never be a problem and a luxurious living situation can very well be a possibility. You will however have to prove that you earn a steady income to meet your contractual obligations and that there is also availability, of course.
2 Comments