Reading books about money and understanding how your accounts and loans work can go a long way towards helping you keep your credit in good repair. For example, if you know that some loans will charge you extra if you pay off your loan faster while others will not, you will be in a batter position to make financial decisions.
Plus, the more you know about money in general, the more comfortable you will feel with it and the better decisions you will be able to make, which will help improve your overall financial state and will help you keep your credit in good shape.
You don’t need to do heavy-duty research to appreciate how money works. One easy way to consider money is to think of it the way you think of time. You likely hate to waste time and you want to make the best use of it possible. Apply the same attitudes to your financial life and watch your finances soar!
If overspending has caused you to have a bad credit score, consider the following sneaky mind set trick: equate your money with your time. For example, if you make twenty dollars an hour, then a magazine subscription of $20 will represent one hour of your work.
Imagine an hour of your work and ask yourself whether the subscription is worth the time you put into the twenty dollars. Once you start seeing money as something that comes from your hard work rather than a general “thing” impulse spending will seem much less attractive, and it will be easier to keep your credit card limits low and you bank account stocked up with cash!
Most bankruptcies are caused by the fallout that occurs as a result of business failures, law suits, health costs, and divorces. Getting a prenuptial agreement helps to ensure that a divorce will not adversely affect your finances and lead to a ruined credit rating (keeping accounts separate while married is also a good idea, as your spouse’s own financial troubles can all too easily become your own). Having a lawyers look over contracts can at least reduce the risks of unfavorable agreements that can put you at a disadvantage in business.
Talk to your bank and lenders about services they offer to keep you safe. Overdraft protection, for example, is a basic service that often costs nothing or very little extra but which protects you in case you withdraw too much money from your bank account.
With overdraft protection, you do not get a “ding” on your credit report or a charge for insufficient funds. In most cases, you get a day or two to add more money to the account to cover the gap. Some credit cards and other loans offer a similar service or offer insurance which protects you in case you lose your job and are unable to pay for a few months.
