Your Credit Score and Your Savings Account – Are They Related?
Believe it or not one of the best ways to keep your credit score high is to save money every month. Even if you are only able to save lives say $30 a month, investing your savings will better prepare you for any emergencies in the future. It will also help you control your spending. I currently take money out of my savings every month to put towards paying down my current debt. This would not be possible if I didn’t put extra money towards my savings.
Having a healthy amount of money in your savings will also come in handy should you get sick or are unable to work for a period of time. You can then use your savings to pay bills and keep late payment remarks off your credit report.
A common practice would be to save at least 10% of your income every month. That seems to be a very reasonable and attainable goal for most. As I do you can use these savings to make sure that no debts get out of control. Most banks also offer a direct deposit or automatic savings feature. This can either put a portion of your direct deposit paycheck into a separate savings account, or just transfer a dollar amount at certain intervals to your savings from your checking account.
Automatic savings is a very useful tool. You are much less likely to spend money if it is never actually in your hands.
Along with saving keeping track of your money and your spending habits is also very important if you wish to improve your credit score. Impulse buying is a disease. All the little knickknacks and other things you spend your money on definitely add up. These are things like maybe buying candy in the checkout line or a newspaper that were never going to read.
Impulse buying usually results in getting items that we want but definitely do not need. A great exercise is to record the dollar amounts for everything you buy for a month. You’ll be astounded to see how much money is wasted on unnecessary purchases.
There are still people to this day that do not see how your savings and your credit score are linked. It comes down to your mindset about financial obligations. Getting into the habit of saving money and not spending frivolously cannot help but lead to an improvement in your credit. Even if you think that is mambo jumbo everyone can appreciate the fact that the more money you save the more money you can put towards producing your debts and paying your bills on time.
If you have not received your free credit report this year I suggest you get on that right away. Ordering your report is always the first that an improving a person’s credit.
The first step in taking command of your credit and your life is to find out where you stand. How’s your credit score? 0-600 Poor, 601-680 Fair, 700-774 Good, 775+ Excellent. Find out your score now! There are no excuses since you can get a Free Credit Score!
See your Credit Score for $0 at CreditReportViewer.com. It’s Free and available in seconds.
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