Tidbits® – November 2008Credit insight from Credit.comWelcome to the Credit.com newsletter!In this issue, we're showing you three important things to work on during a recession, talking about credit score damage and getting ready for the holiday season. We'd love to hear from you! Send us an email with your questions or comments anytime! Quick TipAre you getting the rates you deserve on your credit cards? You might be able to save hundreds of dollars by transferring your balances to a new credit card with a lower rate and better rewards! You'll get the best deal if you have good credit. Shop for a low APR credit card online: 3 Things to Work on During the Credit CrisisA recession is hard on everyone. But it also provides an important opportunity to refocus your financial goals. It's an ideal time to take a close look at how you can improve in these three main money categories: 1. Your Credit Score Your credit score is crucial now more than ever. You can prepare for the future by focusing on having the best credit score possible. Start by ordering all 3 of your credit reports and credit scores online to get the full picture: http://www.credit.com/r/identity_guard_upsell/ Bad credit scores: Look on your report for large credit card balances or negative records such as late payments or collection accounts. These do the most credit score damage. Negative records will have a set expiration date and they'll lose impact as they get older. Reducing your credit card debt-to-limit ratio is also a good move. You can easily estimate how changes might impact your score with our free Score Compass tool: https://www.credit.com/r/tidbits_compass/ Good credit scores: Good job! You're in a good position given the financial downturn. You should avoid making late payments, increasing your credit card balances or closing old accounts.Sign up for a credit monitoring program to ensure your good credit is kept safe during these turbulent times: http://www.credit.com/r/identity_guard_upsell/ 2. Your Debt Large debt balances are a burden even in a good economy; in a recession they risk dragging you down. Reducing your debts helps your monthly budget and your credit scores. Each person's situation is unique, but here are some general guidelines: Under $10,000 in debt: Depending on your income, you can probably find a way to repay these debts on your own. Make sure that your balances are on low APR credit cards and start putting as much as you can toward the highest interest credit card debts each month. $10,000 to $50,000 in debt: You may want to find some help with your debt situation. Working with a debt counseling or debt settlement program could help you become debt free more quickly. You could consider selling something like a car or family heirloom to get a head start. Over $50,000 in debt: A debt amount that exceeds your annual income is going to be very difficult to pay off without drastic action. You might benefit from talking to a debt settlement or bankruptcy professional: https://www.credit.com/r/dcl_ufg/ 3. Your Savings If you don't already have a healthy savings plan, this is a great time to start. Build a safety net with an emergency fund that could cover 3-6 months of your basic expenses in the event of job loss or illness. A free high-yield FDIC-insured savings account is a safe way to earn 2.75% on your savings: http://www.credit.com/r/ing-orange-checking Contributing to 401(k) and IRA accounts can also help cut your taxes. If you're getting ready for retirement the next five years, talk to an investment professional about your choices. What are you doing to improve your financial health? Share your tips and questions with our team at tidbits@credit.com Ask JohnHow low can a credit score go? Do you have to worry about new credit damage if your score is already at the bottom of the scale? Our credit score expert explains how things work below 650 and what you need to consider if you have bad credit. Get the real story from John Ulzheimer: On the BlogThe holiday season is just around the corner. With the economic troubles, it is more important than ever to have a plan for your winter spending. Receive tips for having an all-cash Christmas and download our free Holiday Spending Worksheet. Get ready for the holidays: Quote of the Month"It's a recession when your neighbor loses his job; it's a depression when you lose yours" - Harry S. Truman Tidbits® – November 2008
About this newsletter |