Tuesday, June 17, 2008

Hey all you Young, Fabulous, and Broke!

Suze Orman wrote a book for us and it is really great. It's affirming some knowledge and plans W and I already had and giving nice tips. I got it today and read the first half. The second half has all the stuff I really need to read up on because I'm not there yet: Retirement savings, investing, buying a home, and finances and marriage. Throughout the first half though, there were tips for already married Y,F&B, as she calls us. So, even though I'm not your typical 26 year old as I've been married close to 7 years now, have two children, AND live in a house for free while going to school, the book is still very apt.

A few tips I've learned:

1. Check ALL THREE credit bureaus. Earlier this year I checked one at www.annualcreditreport.com and everything looked good. They ask for verification of student loan account numbers and other loan account numbers and then you get a free printout. I'm not sure I can get a free print out from all three, but it seems you can. You DO have to pay for a FICO score. That's the number you want to be over the 720 mark. If you are applying for a loan for a car or mortgage, then check all three, but check one if not.

2. It's true what they say about not closing credit card accounts. Cut up the card if it's paid off and you don't want to use it, but keep the account open to improve a FICO score. Also, don't apply for too many loans or lines of credit at one time.

3. Being an authorized user on a parent's credit card affects your FICO score. That's a good thing if your parent's scores are good, but really bad if they are not. However, if your parents have hurt your score because of this, you can get it removed by having your parents remove you from the credit card and then contact the credit bureau to let them know it's been done.

4. If your interest on your credit cards is HIGHER than your interest on your savings account, STOP putting money in savings (take it out even) and pay off the credit card first. You may not want to give up the security of the savings account, but in an emergency you can use your credit card if it's paid down. Also, once it is paid off, you can easily start saving again.

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