WEBVTT - Busting Some Credit Score Myths #491 0:00:00.080 --> 0:00:02.920 Welcome to How the Money. I'm Joel and I am Matt, 0:00:03.000 --> 0:00:05.920 and today we are busting up some credit score myths. 0:00:24.960 --> 0:00:29.080 Credit scores, Baby, everybody's got one. It's kind of like 0:00:29.080 --> 0:00:31.159 a belly button, kind of like, oh, it makes me 0:00:31.200 --> 0:00:34.239 think of everyone poops. Do you know that book? Yes? 0:00:34.320 --> 0:00:36.080 I do. I think that books on my mind because 0:00:36.120 --> 0:00:40.559 we are considering potty training Westy to cut out diapers 0:00:40.600 --> 0:00:43.519 from our our monthly grocery. But wouldn't be nice? Are 0:00:43.560 --> 0:00:45.159 y'all thinking about doing that soon? Yeah? We'd like to. 0:00:45.320 --> 0:00:47.680 It's but the problem is, you know, you have three girls. 0:00:47.720 --> 0:00:50.319 I have two girls, and everybody says it's so much 0:00:50.320 --> 0:00:52.839 easier to potty train girls. So I'm like really nervous 0:00:52.840 --> 0:00:55.240 about potty training a boy. Yeah, we've pulled down the 0:00:55.240 --> 0:00:57.880 little Ikea green, the green and white little Ida potty 0:00:58.280 --> 0:01:01.880 same he Westy is totally interested in it. We just 0:01:01.880 --> 0:01:03.640 haven't pulled the plug yet. But I told Kate the 0:01:03.720 --> 0:01:06.080 last package of diapers that we just got, I was like, 0:01:06.160 --> 0:01:08.319 that is it, Like, let's commit let's do it. We're 0:01:08.319 --> 0:01:11.640 gonna cold turkey do the thing where you know, there's 0:01:11.640 --> 0:01:13.200 this whole approach. I don't want to go into take 0:01:13.319 --> 0:01:15.399 a full weeken inddicate. Yeah, like there's this approach where 0:01:15.400 --> 0:01:17.240 you just go cold turkey and you just let them 0:01:17.280 --> 0:01:21.199 go all eyes on the little dude, and basically they 0:01:21.319 --> 0:01:24.080 don't like that feeling of having just soiled themselves, and 0:01:24.120 --> 0:01:26.720 so they quickly learned like like even at night, no 0:01:26.840 --> 0:01:29.160 pull ups, nothing like that. Just like everyone poops, everyone 0:01:29.160 --> 0:01:30.680 does have a credit score. And that's what we're talking 0:01:30.680 --> 0:01:32.520 about today, right, Yeah, but before we get to that 0:01:32.520 --> 0:01:34.440 real quick, man, I just wanted to mention it is 0:01:34.480 --> 0:01:37.680 the beginning of spring right now, basically like warmer weather 0:01:38.160 --> 0:01:41.400 and what happens when the weather gets warm The flowers 0:01:41.400 --> 0:01:43.920 are bloomin. That's true, but also the bugs come out 0:01:44.040 --> 0:01:46.800 right and so especially in the South. Like I just 0:01:46.920 --> 0:01:50.040 had a tenant emailed me the other day and she's like, hey, 0:01:50.120 --> 0:01:51.680 by the way, I want to let you know, start 0:01:51.720 --> 0:01:53.960 to see some more bug activity at the house, which 0:01:54.240 --> 0:01:58.040 is my reminder that it's time to spray for bugs 0:01:58.360 --> 0:02:01.760 and some dl peskin role exactly. We've talked about this 0:02:01.880 --> 0:02:04.320 a few times over the years, but it's worth revisiting 0:02:04.680 --> 0:02:07.200 because Yeah, I wrote an article up on our site 0:02:07.200 --> 0:02:09.239 at how the Money dot Com just telling people how 0:02:09.280 --> 0:02:11.640 to do it themselves. And it's amazing how much money 0:02:11.720 --> 0:02:13.720 you can save because a lot of our listeners are 0:02:13.720 --> 0:02:16.480 probably paying something like a hundred dollars a quarter to 0:02:16.520 --> 0:02:19.160 a pest control company to come for a quarterly spraying. 0:02:19.160 --> 0:02:21.359 So let's say you're you're spending four dollars a year 0:02:21.800 --> 0:02:24.480 to combat bugs to keep them out of your house. Well, 0:02:24.639 --> 0:02:27.359 you can d I Y it and literally you will 0:02:27.360 --> 0:02:30.400 shell out no, no more than and actually less than 0:02:30.440 --> 0:02:32.920 a hundred dollars uh and in the beginning, and that 0:02:33.040 --> 0:02:36.520 supply the sprayer and the chemicals. And this is not 0:02:36.639 --> 0:02:39.120 the chemical that you can buy at home debo by 0:02:39.120 --> 0:02:41.040 the way, this is the chemicals that the pros use. 0:02:41.320 --> 0:02:44.080 You can get both for for like, you know, roughly 0:02:44.120 --> 0:02:46.120 in the range of seventy bucks. Yeah, and you're not 0:02:46.160 --> 0:02:49.760 just buying like a little spray bottle to like you know, like, 0:02:50.080 --> 0:02:53.200 this is professional grade stuff. And we we crunched the 0:02:53.240 --> 0:02:55.520 numbers on it too. And literally once after you get that, 0:02:55.560 --> 0:02:59.359 you're only using something like two dollars worth of chemicals 0:02:59.440 --> 0:03:01.760 over the course of a year. And so you're looking 0:03:01.840 --> 0:03:05.960 at u versus two dollars a year after that upfront cost, 0:03:06.080 --> 0:03:07.960 and it's easy to see that you are quickly going 0:03:08.000 --> 0:03:09.240 to be able to come out ahead. And I think 0:03:09.240 --> 0:03:10.959 most people might hear that and they're like, well, there's 0:03:10.960 --> 0:03:13.720 gotta be a catch, right, like, uh, something's in fear 0:03:13.800 --> 0:03:15.880 in this process, or you know what, I don't think 0:03:15.919 --> 0:03:17.800 I'm gonna know be able to know how to do this. 0:03:17.840 --> 0:03:21.320 And unfortunately, there are instructional videos on you know, some 0:03:21.360 --> 0:03:23.320 of these websites where they will show you how to 0:03:23.360 --> 0:03:26.520 do it properly and really honestly if any dummy can 0:03:26.560 --> 0:03:29.200 do it, so it's it's not something that takes special 0:03:29.200 --> 0:03:31.360 skills or anything like that. And and just considering how 0:03:31.440 --> 0:03:33.520 much money you can save you in one fell swoop, Um, 0:03:33.600 --> 0:03:36.560 we're all kind of faced with higher rates of inflation, 0:03:36.680 --> 0:03:39.120 higher costs on almost everything. He's right now, if you're 0:03:39.120 --> 0:03:41.760 looking to save money in a big way, and just 0:03:41.800 --> 0:03:43.480 like one fell swoop, this is definitely one thing to 0:03:43.480 --> 0:03:46.480 look at. Absolutely. And something else I gotta tell listeners about. 0:03:46.480 --> 0:03:49.280 Have we have we talked about about my bug assault 0:03:49.480 --> 0:03:51.960 gun on the show before you know talk about the 0:03:51.960 --> 0:03:54.680 one that blows their No, it's this one that shoots salt. Oh, 0:03:54.720 --> 0:03:56.640 that's right, that's right, that's right. That's right. So I 0:03:56.640 --> 0:03:59.440 got this for Christmas and it is the coolest thing. 0:03:59.720 --> 0:04:02.600 It's a little so basically it's like a little pump shotgun, 0:04:03.240 --> 0:04:05.440 but it's a it's made of plastic. It's a toy, 0:04:05.640 --> 0:04:08.600 and it's got a little canister and you pour table 0:04:08.640 --> 0:04:10.920 salt in there, like like a tablespoon or two tablespoon's 0:04:10.920 --> 0:04:14.200 worth of literally table salt. You close it up, you 0:04:14.240 --> 0:04:16.839 pump it, and when you shoot it, it literally shoots 0:04:16.880 --> 0:04:19.160 out like a little blast of a little bit of salt, 0:04:19.240 --> 0:04:21.880 kind of like a shotgun pellet. It's it's literally a 0:04:21.920 --> 0:04:25.760 shotgun for bugs that shoots salt. And so this is 0:04:25.800 --> 0:04:28.719 the most fun I have ever had taken down little 0:04:28.720 --> 0:04:30.840 house flies in my house. I will link to it 0:04:31.160 --> 0:04:34.120 uh in our show notes because literally it is so fun. 0:04:34.160 --> 0:04:36.120 It's it's way more fun than than the old bugs 0:04:36.120 --> 0:04:40.440 apper down the South Georgia, which very few people are 0:04:40.480 --> 0:04:43.719 aware of what I'm talking about here, But aside from 0:04:43.880 --> 0:04:45.719 the d ips control, if you want to get yourself 0:04:45.839 --> 0:04:50.200 a bug of salt gun, I highly recommend it. I mean, 0:04:50.240 --> 0:04:51.880 it does sound like fun. I might have to get one, dude, 0:04:51.960 --> 0:04:53.800 just for the sheer joy. Next time you all are 0:04:53.839 --> 0:04:55.880 over and there's a little house fly or a nat 0:04:55.920 --> 0:04:57.160 or something like that, let me take it. I'll let 0:04:57.160 --> 0:04:58.560 you have a shot with it, because it is a 0:04:58.560 --> 0:05:00.520 ton of fun. Good. I appreciate that it's just salt, 0:05:00.600 --> 0:05:02.720 and so you miss, or even if you don't miss, 0:05:02.760 --> 0:05:03.960 you know, you pick up the five. But then like 0:05:04.000 --> 0:05:05.640 all the salt just kind of disperses a little bit. 0:05:05.640 --> 0:05:07.320 But it's salt. It's like, it's not that big of 0:05:07.320 --> 0:05:08.440 a deal. If there's a little bit of salt on 0:05:08.440 --> 0:05:11.000 the ground. Next time you're sweet or your vacuum, you 0:05:11.040 --> 0:05:12.680 get it up off the floor and you barely notice 0:05:12.680 --> 0:05:15.080 it and tell them I bet exactly. Um. Nice, Okay, Well, 0:05:15.080 --> 0:05:16.920 word to the wise, do your own pest control, save 0:05:17.000 --> 0:05:18.720 you some some some money, and bug a salt gun. 0:05:20.160 --> 0:05:22.040 All right, and let's move on. Let's mention the beer 0:05:22.080 --> 0:05:23.920 that we're having on the show. This one is called 0:05:23.920 --> 0:05:27.280 Hello World, and it's by Spyglass Brewing, and this one 0:05:27.279 --> 0:05:29.560 will sent to us by listener Gary. He sent us 0:05:29.600 --> 0:05:33.000 Monday's beer. Looking forward to having this one today, And 0:05:33.360 --> 0:05:34.919 we'll give our thoughts at the end of the episode, 0:05:35.120 --> 0:05:37.600 but for now, Matt, looking onto the subject at hand, 0:05:37.640 --> 0:05:40.760 we are of course tackling some credit score, miss we're 0:05:40.760 --> 0:05:43.360 busting them up. And you know, it made me think, 0:05:43.400 --> 0:05:45.360 like there are all sorts of myths that have grown 0:05:45.400 --> 0:05:49.280 into legends over the years, over decades. The lock this 0:05:49.440 --> 0:05:53.200 monster is one of those, right, Paul bunyan UFOs, Like 0:05:53.240 --> 0:05:56.000 did they exist? Don't they? All sorts of of these 0:05:56.040 --> 0:05:59.720 like they're they're just drones. You know, all of these 0:05:59.760 --> 0:06:04.040 things have developed outsized tales that make for interesting TV shows, 0:06:04.279 --> 0:06:06.400 and they're fun to talk about maybe on a Friday 0:06:06.480 --> 0:06:09.039 night over a nice craft beer with some of your friends, 0:06:09.240 --> 0:06:11.240 just kind of well, I don't know, is it real 0:06:11.360 --> 0:06:13.479 or isn't it? And the same as maybe like the 0:06:13.560 --> 0:06:16.920 legend with the moon landing being fake, although I don't know, 0:06:17.040 --> 0:06:19.960 that's just kind of less fun to talk about, and uh, 0:06:20.080 --> 0:06:23.239 not so small contingent of Americans they continue to believe 0:06:23.320 --> 0:06:26.559 in the existence of like a sasquatch like creature roaming 0:06:26.560 --> 0:06:29.560 the woods. But yeah, some have lashed onto these tales. 0:06:29.800 --> 0:06:33.440 They've they've taken them as factual. And you know, while 0:06:33.560 --> 0:06:37.200 I don't have definitive proof that Bigfoot doesn't exist, it 0:06:37.200 --> 0:06:40.320 certainly doesn't match up with what my eyes have seen firsthand. 0:06:40.560 --> 0:06:42.919 And part of the reason these myths persist is because 0:06:42.920 --> 0:06:46.160 there isn't documented evidence to the contrary, right, I mean, 0:06:46.480 --> 0:06:48.520 but credit score myths, on the other hand, well, they 0:06:48.520 --> 0:06:53.120 continue to exist despite hard evidence of their inaccuracies. And 0:06:53.160 --> 0:06:55.200 so that's why we're talking about this today. I mean, 0:06:55.240 --> 0:06:58.440 these these myths impact your finances in a real and 0:06:58.480 --> 0:07:00.640 ongoing way. So we've got a scuss some in a 0:07:00.640 --> 0:07:03.560 way that maybe your bigfoot obsession doesn't impact your day 0:07:03.600 --> 0:07:05.240 to day life, it's right, man, so and if it does, 0:07:05.279 --> 0:07:07.560 you've got a real problem. It's time to bust these 0:07:07.640 --> 0:07:09.800 myths up. And part of the reason too, that we're 0:07:09.800 --> 0:07:13.120 tackling this topic now is because of the fact that 0:07:13.160 --> 0:07:16.200 March it's National Credit Education Month. But you didn't know that. 0:07:17.000 --> 0:07:21.960 There's a there everything everything these days. But there are 0:07:22.000 --> 0:07:24.680 also a lot of misconceptions and miss understandings out there 0:07:24.680 --> 0:07:28.000 about credit scores and these myths. They lead folks to 0:07:28.040 --> 0:07:31.920 take just different past like incorrect paths towards their credit. 0:07:32.120 --> 0:07:36.120 It often impacts their score negatively, causing actual real side effects. 0:07:36.320 --> 0:07:38.280 And we want you to have a great credit score 0:07:38.360 --> 0:07:41.120 because it has such a wide ranging impact. Living without 0:07:41.120 --> 0:07:43.680 a credit score would be tough in a modern society, 0:07:44.120 --> 0:07:46.560 and like, is that a good thing that we have 0:07:46.720 --> 0:07:49.840 to function with the credit score? Not necessarily. We're not 0:07:50.200 --> 0:07:52.760 huge fans of the credit bureaus and you know, specifically 0:07:52.800 --> 0:07:56.200 their inability to keep our personal data secure. But it's 0:07:56.240 --> 0:07:57.880 kind of like we've been put down in a game 0:07:58.320 --> 0:08:01.119 that we just can't stop playing. I mean could stop playing, 0:08:01.120 --> 0:08:03.320 but you would have to need a pile of cash 0:08:03.560 --> 0:08:06.560 in order to truly avoid the credit score system altogether, 0:08:06.600 --> 0:08:09.920 in order to completely skirt it. Yeah, it's kind of 0:08:09.960 --> 0:08:11.600 like even if you want to be an entrepreneur at 0:08:11.600 --> 0:08:13.480 age twelve, like, you still got to finish high school. 0:08:13.520 --> 0:08:16.320 I mean it's it's it's part of the process and 0:08:16.440 --> 0:08:18.280 you'll have to your your parents are gonna get in 0:08:18.280 --> 0:08:20.680 big trouble if you don't write. I mean it's um, 0:08:20.880 --> 0:08:22.480 is there some law like do you actually have to 0:08:22.480 --> 0:08:25.160 finish high school? No, I think you're gonna get in 0:08:25.160 --> 0:08:27.560 big trouble if you drop out before before the age 0:08:27.600 --> 0:08:30.160 of sixteen. I didn't know that. Yeah, I think I 0:08:30.160 --> 0:08:31.800 don't know what the actual roles are, but I'm pretty 0:08:31.800 --> 0:08:33.240 sure you gotta go to school, and the kids are 0:08:33.240 --> 0:08:35.760 listening to school, I mean you should, like I agree 0:08:35.800 --> 0:08:38.839 that that's probably it's probably a good, healthy approach to 0:08:39.440 --> 0:08:41.640 becoming a fully formed Adult'm pretty sure the state can 0:08:41.640 --> 0:08:44.280 come after the parents if if the kids come out, Yeah, 0:08:44.280 --> 0:08:45.520 if they take them out of school and there's no 0:08:45.559 --> 0:08:47.200 sign that they're doing any sort of homeschooling. What kind 0:08:47.200 --> 0:08:50.760 of country we're living in. I don't know. We might 0:08:51.080 --> 0:08:53.680 disagree on whether or not that's a reasonable thing, but 0:08:53.840 --> 0:08:56.000 it's reasonable. But I feel like people should have a choice. Whatever. 0:08:56.520 --> 0:08:59.040 Let's go, let's don't take your kids out of school. 0:08:59.080 --> 0:09:01.160 They mean, I'm not they will say it school because 0:09:01.160 --> 0:09:03.560 they're gonna go to college most likely to what other 0:09:03.600 --> 0:09:05.360 people to have the choice if they choose not to, 0:09:05.520 --> 0:09:07.760 if they choose to rip their kids out of school 0:09:07.880 --> 0:09:11.120 and just you know, send them down the Jeff Bezos path, Um, yeah, 0:09:12.679 --> 0:09:15.520 gens kid and they're able to take whatever remedial course 0:09:15.640 --> 0:09:18.800 or class where they're basically able to get the equivalent 0:09:18.840 --> 0:09:21.360 of a high school diploma. Of course they should be 0:09:21.400 --> 0:09:23.720 able to do that, right, Okay, al right, well, let's 0:09:23.800 --> 0:09:25.640 let's move on. Let's talk about what a good score 0:09:25.720 --> 0:09:29.040 is because that kind of sets up this question of like, well, 0:09:29.040 --> 0:09:30.960 what are we aiming to achieve here with with our 0:09:31.000 --> 0:09:34.200 credit score. And you know, Matt, you just mentioned one 0:09:34.200 --> 0:09:36.160 way to avoid the system would be to have just 0:09:36.200 --> 0:09:38.760 a ton of money. You're loaded, right, Like, you don't 0:09:38.760 --> 0:09:41.480 need a lender to approve you to buy a home 0:09:41.520 --> 0:09:43.600 if you've got five million bucks in the bank, and 0:09:43.600 --> 0:09:46.040 you can go buy any home that you desire. But 0:09:46.120 --> 0:09:48.400 since most folks don't have that, most folks don't have 0:09:48.440 --> 0:09:52.280 that much money on hand, especially these days, like to 0:09:52.320 --> 0:09:55.040 buy home, which it gets really expensive. In a car, 0:09:55.320 --> 0:09:58.800 same thing, right, cars are not cheap, so paying attention 0:09:58.840 --> 0:10:00.679 to your credit score is a mo But then the 0:10:00.760 --> 0:10:02.600 question is like what is a good score? And I 0:10:02.600 --> 0:10:05.439 guess you know, we have to tackle that because um, 0:10:05.679 --> 0:10:08.680 and it's actually kind of a difficult question to answer 0:10:08.760 --> 0:10:11.640 because there are different scales, like kind of like how 0:10:11.960 --> 0:10:14.800 we're talking about schools here, how some schools might have 0:10:15.160 --> 0:10:17.760 an A scale an eight eight could be considered an A, 0:10:17.880 --> 0:10:19.720 I guess in some schools or ninety I remember in 0:10:19.760 --> 0:10:22.599 high school when migrating scale changed and it used to 0:10:22.640 --> 0:10:24.800 be a ninety two and up wasn't a and then 0:10:24.800 --> 0:10:27.720 they changed to a ninety Enough was an A Seriously, yeah, 0:10:27.880 --> 0:10:29.520 in the middle of high school and so weird. A 0:10:29.559 --> 0:10:33.040 couple of my my above bees are obviously a D 0:10:33.160 --> 0:10:35.720 C S or no, it's it depends on the school system. 0:10:35.760 --> 0:10:38.120 And so I distinctly remember, like two of my bees 0:10:38.160 --> 0:10:40.080 became a's all of a sudden, My g p A 0:10:40.200 --> 0:10:43.600 got a little bit higher. And so similarly with credit scores, 0:10:43.760 --> 0:10:47.040 some of these bureaus have just a different threshold for 0:10:47.120 --> 0:10:51.360 what's considered good or great and so yeah, so the 0:10:51.360 --> 0:10:54.319 score that your lender sees when you're refinancing an auto loan, 0:10:54.400 --> 0:10:56.880 let's say, it can differ from the one you get 0:10:57.080 --> 0:10:59.720 if you were to get that scored directly from the 0:10:59.720 --> 0:11:02.520 beer row. And each bureau also has quite a few 0:11:02.720 --> 0:11:05.640 credit scores for you behind the scenes, so it's it's 0:11:05.640 --> 0:11:08.440 not even different models. Yeah, like there's this one score 0:11:08.520 --> 0:11:10.480 that you have for each bureau. It's like they might 0:11:10.520 --> 0:11:13.400 have a dozen scores for you based on different factors. 0:11:13.640 --> 0:11:16.000 And so the score your lender sees when you're refinancing 0:11:16.000 --> 0:11:18.600 an auto loan, let's say, can differ from the one 0:11:18.640 --> 0:11:20.240 that you get if you were to get that score 0:11:20.480 --> 0:11:23.040 directly from the bureau. And you know, most of these 0:11:23.080 --> 0:11:25.040 scores are on a scale that goes up to like 0:11:25.200 --> 0:11:28.880 eight fifty or nine hundred, and some folks are striving 0:11:28.920 --> 0:11:32.079 for a perfect credit score under each one of these models, 0:11:32.160 --> 0:11:36.200 and that's just a recipe for in futility. Um, it's 0:11:36.240 --> 0:11:39.839 it's just completely unnecessary to strive for perfection. Basically, if 0:11:39.840 --> 0:11:42.040 your score is in the seven forty plus range on 0:11:42.120 --> 0:11:44.800 any of these scales, that's good enough and it will 0:11:44.800 --> 0:11:47.480 basically qualify you for the best terms for different loans 0:11:47.480 --> 0:11:50.439 you might need access to. Just remember that seven forty 0:11:50.600 --> 0:11:54.520 or above is basically that a range where you're gonna 0:11:54.559 --> 0:11:56.840 want to be in order to, yeah, get the best 0:11:56.920 --> 0:12:00.400 terms on all sorts of different lending products until they 0:12:00.480 --> 0:12:02.520 changed the rules on you. All right, let's go ahead 0:12:02.520 --> 0:12:04.959 and get started busting up some of these credit score myths. 0:12:05.120 --> 0:12:07.120 By the way, you remember the guys from MythBusters back 0:12:07.120 --> 0:12:09.320 in the day, Like, that's one of the inspiration, you know, 0:12:09.320 --> 0:12:11.160 for the title of this episode for the listeners out there. 0:12:11.200 --> 0:12:13.720 That was one of those first hit reality styles SIGN 0:12:13.720 --> 0:12:15.760 and CE TV shows. Yeah, one of my favorite ones 0:12:15.760 --> 0:12:19.280 I remember was they're like blasting cannonballs into a wall. Um. 0:12:19.679 --> 0:12:22.480 And interestingly, this was like one of the episodes where 0:12:22.480 --> 0:12:25.920 they screwed up and like they're out out in the desert, 0:12:26.000 --> 0:12:28.200 like at a firing range or like like a bomb 0:12:28.280 --> 0:12:31.720 range basically, and like the cannon like tipped up and 0:12:31.760 --> 0:12:34.839 so the cannonball missed the wall and it went ricocheting 0:12:34.840 --> 0:12:38.120 off of like one of the hills and into a neighborhood. Gosh, yeah, 0:12:38.320 --> 0:12:41.480 super crazy. Uh, nobody got hurt, but like I do 0:12:41.520 --> 0:12:43.439 remember like crashing into some some dude's house. I think 0:12:43.440 --> 0:12:46.240 it like went through a van, pretty serious, Like, and 0:12:46.280 --> 0:12:48.600 that's the day MythBusters got canceled. No, they did. Like 0:12:48.679 --> 0:12:51.880 that was right in the middle of a run of 0:12:51.920 --> 0:12:54.520 seasons where they were crushing. It probably made for good 0:12:54.520 --> 0:12:56.880 TV ratings, I think it did. Like that's the one 0:12:56.920 --> 0:12:59.400 I remember was the one where there was an errant 0:12:59.640 --> 0:13:02.760 cannon all. I could not imagine seeing that in real life. Anyway, 0:13:02.840 --> 0:13:04.920 let's do some mythbusting of our own. Uh. And the 0:13:04.920 --> 0:13:07.520 first one we wanted to share is that your credit 0:13:07.559 --> 0:13:10.040 score doesn't really matter all that much. And there's a 0:13:10.040 --> 0:13:11.599 good reason that we're starting with this one because we 0:13:11.640 --> 0:13:14.240 want to highlight the fact that your credit score is 0:13:14.280 --> 0:13:17.600 incredibly important. It affects so much more of your life 0:13:17.600 --> 0:13:20.240 than you realize. We just talked about the need for 0:13:20.280 --> 0:13:23.040 a credit score and modern society, but everything is going 0:13:23.080 --> 0:13:26.360 to cost you more if your credit score stinks. Lenders 0:13:26.400 --> 0:13:29.440 they're gonna charge you what's called a risk premium if 0:13:29.480 --> 0:13:31.480 your score isn't great, But they also might decide not 0:13:31.559 --> 0:13:33.599 to lend to you at all if your score is 0:13:33.640 --> 0:13:35.720 in the dumps, and you might see to yourself, all right, 0:13:35.720 --> 0:13:38.240 that's fine, I'm not gonna ever own a home. That's fine. 0:13:38.440 --> 0:13:40.480 Your credit score comes in play when you're renting a 0:13:40.520 --> 0:13:43.760 house to land lords. They're gonna almost always run a 0:13:43.760 --> 0:13:46.280 credit check, and that is going to impact your ability 0:13:46.360 --> 0:13:48.440 to get the place that you want. You know, if 0:13:48.440 --> 0:13:51.920 I'm choosing between two tenants, they both seem great, they 0:13:51.960 --> 0:13:54.200 both make the same amount of money. I've got to 0:13:54.240 --> 0:13:56.800 base my decision on something, and the credit score can 0:13:56.800 --> 0:13:59.760 often tip the scales. A bad or non existing credit 0:13:59.760 --> 0:14:02.000 score could also impact your ability to get home, internet 0:14:02.080 --> 0:14:03.640 or cable, or it might require you to put down 0:14:03.679 --> 0:14:06.360 a deposit. You might even pay more for auto insurance 0:14:06.400 --> 0:14:09.320 if your score is low. Having a good, solid credit 0:14:09.360 --> 0:14:12.560 score is not a trivial thing. Yeah, your credit score 0:14:12.679 --> 0:14:15.680 has an impact in so many areas of your life, 0:14:15.760 --> 0:14:18.440 and not only will a crappy credit score impact your 0:14:18.440 --> 0:14:21.800 ability to spend money, to take out a loan, for 0:14:21.920 --> 0:14:25.040 to take on debt for something that you're looking to buy, which, 0:14:25.120 --> 0:14:28.280 let's be honest, maybe this is actually a blessing in disguise. Um, 0:14:28.360 --> 0:14:31.160 if you potentially keep you from spending more money, yeah, 0:14:31.200 --> 0:14:33.400 then you can afford to well. It can also hamper 0:14:33.440 --> 0:14:36.960 your ability to earn money. And yeah, your credit history 0:14:37.080 --> 0:14:39.760 can have an impact when you apply for some jobs, 0:14:39.800 --> 0:14:42.720 like in particular ones in finance, or let's say you're 0:14:42.720 --> 0:14:46.120 moving up to management level, then um, there's a good 0:14:46.200 --> 0:14:49.480 chance your credit score comes into play here. Credit checks 0:14:49.560 --> 0:14:52.440 happen more often for these types of jobs where the 0:14:52.440 --> 0:14:55.080 stakes are higher, like when a security clearance is involved, 0:14:55.160 --> 0:14:57.200 or if you have access to a lot of money 0:14:57.320 --> 0:15:00.160 or sensitive information of your coworkers. I don't know this 0:15:00.240 --> 0:15:01.600 for a fact, but I got a feel in that, 0:15:01.640 --> 0:15:03.680 like bank tellers, if you've got a really really really 0:15:03.680 --> 0:15:05.760 crappy credit scored, like maybe you don't get that bank 0:15:05.800 --> 0:15:08.320 teller job where you're you know, doing up the hundred. Yeah, 0:15:08.400 --> 0:15:10.680 they might be like, sorry, go apply down the street 0:15:10.720 --> 0:15:13.160 at target. Um, and so yeah, you know. One study 0:15:13.200 --> 0:15:17.160 shows that of HR managers are actually gonna check your 0:15:17.200 --> 0:15:20.120 credit history during the hiring process, even though they won't 0:15:20.160 --> 0:15:22.360 be able to see your actual score in most cases. 0:15:22.560 --> 0:15:25.560 But here's the deal. Your score is influenced by what's 0:15:25.560 --> 0:15:27.440 on your credit report. So if they can take a 0:15:27.440 --> 0:15:29.760 look at your credit report, they kind of, in theory, 0:15:29.880 --> 0:15:33.040 can deduce what your score is. And that crummy credit 0:15:33.080 --> 0:15:35.680 report with lots of errors and issues on it is 0:15:35.720 --> 0:15:38.240 going to potentially affect your ability to get the job 0:15:38.280 --> 0:15:40.520 that you want. That's right. All right, We've got more 0:15:40.680 --> 0:15:43.800 credit myths that need to be shelat and we'll get 0:15:43.800 --> 0:15:54.960 to all of those right after this break. All right, 0:15:55.000 --> 0:15:57.480 we're back and we are busting up some of those 0:15:57.520 --> 0:16:01.080 different credit score myths that may have heard of, some 0:16:01.200 --> 0:16:03.080 you may not have heard of before. Um let's get 0:16:03.080 --> 0:16:05.800 to our next one, which is checking your credit score 0:16:06.200 --> 0:16:08.400 hurts your credit score. I feel like this is one 0:16:08.440 --> 0:16:11.120 that's been around for a long time, and you know, 0:16:11.200 --> 0:16:13.440 like years ago, the credit scords were kind of like 0:16:13.880 --> 0:16:17.280 shrouded in secrecy. Like the bureaus and the banks and 0:16:17.400 --> 0:16:19.480 the lenders they knew what our credit score was, but 0:16:19.520 --> 0:16:22.120 we didn't. Sort of like credit scores, we're kind of 0:16:22.160 --> 0:16:25.360 like fight club, right, like the first rule of Credit 0:16:25.400 --> 0:16:28.480 score club is to not talk about your credit score, 0:16:28.520 --> 0:16:30.680 you know, where you're fearing that just like an utterance 0:16:30.720 --> 0:16:33.440 might punish your score where you would you know, see 0:16:33.440 --> 0:16:35.720 a drop significantly. Yeah, it's like almost like the thought 0:16:35.720 --> 0:16:37.280 police would come after you. Like I thought about my 0:16:37.320 --> 0:16:38.880 credit score and I kind of wondered what what my 0:16:38.880 --> 0:16:41.400 point score was total was And it's like, no, if 0:16:41.440 --> 0:16:43.480 if you can ask that question your brain, they're gonna 0:16:43.560 --> 0:16:45.160 take your score down a notch or two. It's almost 0:16:45.160 --> 0:16:47.080 like you're just better off just hoping for the best. 0:16:47.440 --> 0:16:49.520 But luckily that's that's no longer the case. We all 0:16:49.560 --> 0:16:51.720 have access to our our scores pretty much at every 0:16:51.760 --> 0:16:54.280 turn these days. But I truly remember when that wasn't 0:16:54.320 --> 0:16:57.000 the case, because I distinctly remember one of the first 0:16:57.000 --> 0:17:00.400 credit cards I ever got was at a bank that 0:17:00.440 --> 0:17:05.560 no longer exists called Washington Mutual that went it went down, uh, 0:17:05.640 --> 0:17:08.520 you know, the great recession of the late to early 0:17:08.520 --> 0:17:12.520 two thousands there two eight And basically it was one 0:17:12.520 --> 0:17:15.520 of the first credit cards that made your credit score 0:17:15.600 --> 0:17:18.679 known to you on a monthly basis. They basically started 0:17:18.680 --> 0:17:23.240 the revolution, uh, making credit scores widely accessive discover um No. 0:17:23.359 --> 0:17:25.280 I think they came shortly after, and they've done a 0:17:25.320 --> 0:17:28.199 great job doing that. But WAMU was kind of that 0:17:28.400 --> 0:17:31.240 first bank where it was like listen, no annual fee 0:17:31.280 --> 0:17:32.720 credit card, but you get to know your credit score 0:17:32.720 --> 0:17:34.879 every month. And so for you know, money nerds like 0:17:34.960 --> 0:17:37.640 me who wanted to, Yeah, I wanted to, and there 0:17:37.720 --> 0:17:40.399 was no other place on the internet where where I 0:17:40.400 --> 0:17:42.840 don't think this was before credit carma existed. This is 0:17:42.880 --> 0:17:47.480 before the internet, not quite, but this is before electricity. 0:17:48.520 --> 0:17:50.760 I know I'm definitely aging myself here, but it was 0:17:50.800 --> 0:17:52.560 kind of nice to have a credit score that would 0:17:52.600 --> 0:17:55.040 make that known to you. And and you know, since then, 0:17:55.119 --> 0:17:57.600 obviously it's gotten so much easier to stay on top. 0:17:57.600 --> 0:17:59.639 And we'll talk about that a little bit later, but 0:18:00.000 --> 0:18:02.119 I remember in those days where it was like herring 0:18:02.160 --> 0:18:04.040 to find out what your credit score was, and you 0:18:04.119 --> 0:18:06.720 like either had to find that one brandom credit card 0:18:06.760 --> 0:18:09.320 that would do it or just kind of hope and 0:18:09.359 --> 0:18:11.720 pray when you apply for a loan that your credit 0:18:11.840 --> 0:18:13.199 was in decent shape, where you just had to know 0:18:13.240 --> 0:18:15.840 somebody on the inside. But it is important to know 0:18:15.880 --> 0:18:17.560 that there's a difference between a soft pull and your 0:18:17.560 --> 0:18:20.520 credit and a hard one. Hard polls will hurt your score, 0:18:20.520 --> 0:18:22.399 but soft ones won't. And so if you're getting a 0:18:22.440 --> 0:18:25.159 mortgage on a car loan, the lender is gonna run 0:18:25.200 --> 0:18:28.040