Welcome to a weekly feature on the Renés Points blog. Each week this series covers in a “rookie” way either a Delta or travel related theme and attempts to break down to a basic level each topic. You can read up on all the previous posts HERE. Now on to this week’s feature.
I get a bunch of travel cards every year. One of the things that allows me to do this and pick up amazing 100,000 point TOP10 offers (as well as 80,000 point business card offers) is that I do all I can to keep my credit score high. Sure it drops a few points each time I go for a new round of cards, but as you can see from the shot above, long term, my score recovers after a few months and goes back up. This has been the case for YEARS and I have enjoyed literally millions of points by maintaining my FICO score at high levels. How have I done this?
- I always pay my balance in full every month
- I have never EVER missed a payment – EVER!
- I check for fraudulent charges and use alerts
- I do not max out my credit i.e. keep my utilization low
- I utilize my credit and have had a mix of credits
- I check my credit score often
- I check my credit report several times a year
That is a short list but an important one and of them all one of the most important ones is never missing a payment. But did you know your credit score is about much more than just the ability to get travel cards of all kinds of flavors?
One of my local TV WSBT22 stations had an online piece that prompted this post as a reminder. They show that a BAD or even POOR credit score can mean you, no matter what your driving record, can end up paying more for car insurance than someone like me with a good GOOD+ credit score. What else?
A very wise friend of mine a long time ago (well at least in dog years it was long ago) said that “your credit is one of your most important assets” and that is really true when it comes to things like getting a home loan. A good credit score can literally save you a fortune in interest – that is, you could end up paying so much more for a home loan if you do not have a good credit score (or may even stop you from being approved for a home loan). Most in this “hobby” suggest you get no more than 1 or 2 travel cards in the two years leading up to the time you go for a home loan. Wise advice. Is there more?
Believe it or not even renting an apartment can be affected by a poor credit score. You may not be able to get a “normal” cell phone and be stuck with prepaid choices (yuck). If you are considering some jobs like those in finance a poor credit score can mean even if they want to hire you it will become a NO!
Then there are other issues that can “dog” you for years like for us as travelers getting security clearance could be affected by a bad score. In kinda a joking way (but not really) if you find your perfect soul mate and they have a horrible credit score they will not help you to get more frequent flyer points!
Getting back to reality if you want to start your own business why would an institution consider lending you money to start a going concern when you have done such a bad job managing your own credit thus far.
You see my point. Yes we are all about “points” but the ability to do what we “do” is all thanks to responsible use of our credit score. A score of 740 and above most times mean a YES to enjoy huge bonus offers (after spend) and a score below 670 means your life is in a world of hurt and expect nothing but NO, NADA and so on. – René