Financial Focus: The impacts of credit scores

11:30 PM, Aug 01, 2018

COLORADO SPRINGS – We use credit cards every day to pay for things, but how often are you checking your score and what does it mean?

News 5’s partner at Carlson Financial says keeping an eye on your card is very important when it comes to future purchases, loans, and even landing a job.

Swiping these little pieces of plastic is easy, but keeping track of what they’re wracking up is a bit more challenging.

Carl Carlson, CEO of Carlson Financial, said, “Unfortunately they’re very important. You’ve really got to stay on top of them.”

Carlson is talking about credit scores, something that can impact several areas of your life.

“So many places are checking credit scores and if you’re going to borrow money it’s really important. It’s going to determine whether or not you even get the loan and if you get the loan what’s your interest rate going to be on the loan?”

It’s not just about borrowing money.

“You go to get insurance for your home, your vehicle, and one of the things they’re going to do is go check your credit score and if you have a bad credit score your premiums go up on your insurance.”

If you’re trying to land a new job Carlson said, “Most people now, employers, are going to do a check on your credit score and it may mean you don’t even get the job if your credit score is not where it should be.”

So what’s a bad credit score versus a good one?

“300 is the worst credit score and 850 is the best…if you get down around 700 or a little lower you’re no longer in that really good or excellent category…if you have a bankruptcy on your credit score that’s going to hang around for seven years before it goes off, but there are things you can begin doing right away even with that bankruptcy on there that can start improving your credit score.”

One of the simplest things to do in rebuilding that credit is to start paying your credit card bill on time and for everyone, check that credit score when you can.

Carlson also says not paying on time can drop your credit score as much as 100 points. He also says never cancel a credit card because it can bring your score down as well.

Carlson Financial is a sponsor of Financial Focus.

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