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Speaker 1: Welcome to How the Money. I'm Joel and I'm Matt,

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Speaker 1: and today we're talking about how to improve your credit score.

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Speaker 1: All right, Matt, real quick. I wanted to give people

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Speaker 1: a beer tip because we love to talk about beer

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Speaker 1: on the podcast, right, and we normally wait till the

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Speaker 1: end to talk about the beer, But you want to

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Speaker 1: talk about it now, I do, well, I want to.

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Speaker 1: I want to do a tip. So this struck me

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Speaker 1: as really important and it's actually really influenced the way

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Speaker 1: I enjoy beers and how good they are because I've

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Speaker 1: done it a different way and they don't taste as good.

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Speaker 1: So when you buy a six pack or whatever, when

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Speaker 1: you buy a beer, sometimes you have the desire to

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Speaker 1: chill it in the freezer real quick so you can

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Speaker 1: drink it that night or something like that. I think

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Speaker 1: it's really important for the beer to avoid bottle shock

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Speaker 1: and bottle shock and just kind of mess with the

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Speaker 1: taste of a beer is to have it in your

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Speaker 1: fridge overnight, to let it chill naturally gradually instead of yeah, gradually,

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Speaker 1: and then pull it out. Another important tips, So let

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Speaker 1: your beer chill overnight gradually, and then when you pull

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Speaker 1: it out, let your beer warm up for thirty minutes

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Speaker 1: before you pop it open. Um. I think the warmer

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Speaker 1: your beer gets, the more flavors are open. So if

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Speaker 1: you're drinking like cores light, who cares, right, drink it cold?

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Speaker 1: Drinking cold because you don't want those flavors to come

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Speaker 1: out tap the rockies. Yeah, but if you're drinking a

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Speaker 1: good beer, you wanted to warm up a little bit

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Speaker 1: and those natural flavors are gonna come out more. And

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Speaker 1: so I was just thinking about it because our beer

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Speaker 1: today and we'll get into it in a minute is

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Speaker 1: dog Fish Heads Oak aged Vanilla Worldwide Stout, and I

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Speaker 1: was like, okay, I gotta pull this over question. We

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Speaker 1: need to warm that up. It needs to warm up because,

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Speaker 1: like I'm going to get those extra oak and vanilla

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Speaker 1: notes if it's warmer. That's true, man, I hadn't thought

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Speaker 1: about that. We do that all the time without really

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Speaker 1: thinking about it, but just from having had numerous craft

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Speaker 1: beers in the past decade. But yeah, we should do that, Hooks.

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Speaker 1: That's that's a good tip. So there you drink your

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Speaker 1: craft beer and drink it better make sure it tastes awesome.

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Speaker 1: And also I just want to say thank you to

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Speaker 1: all the people that have left ratings and reviews on

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Speaker 1: Apple podcast Man, all the glowing reviews, Thank you guys.

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Speaker 1: It's huge for us. Man, it's huge for us, and

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Speaker 1: so um it makes me feel good about myself. We're

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Speaker 1: on episode ten right now, and if you have been

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Speaker 1: listening since the beginning or just really gotten in the

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Speaker 1: last few episodes and you're into what we're talking about,

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Speaker 1: it's helpful. I would ask you kindly to please leave

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Speaker 1: us a rating and or review on Apple Podcasts or

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Speaker 1: wherever you listen to your podcast. It's super helpful and

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Speaker 1: just um helps other people that love craft, beer and

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Speaker 1: money talk find our podcast. Yeah, Joe, so Atlanta United.

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Speaker 1: We are both big fans uh and we were recording

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Speaker 1: this a little bit ahead of time as we haven't

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Speaker 1: had our first match against uh DC United. Oh Atlanta United.

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Speaker 1: By the way, it's it's our soccer team, right, It's

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Speaker 1: our Atlanta soccer team. I wanted to talk about jerseys,

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Speaker 1: like the expensive jerseys. Yeah. The reason I asked I

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Speaker 1: want to bring that up is because I grew up

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Speaker 1: not not wearing jerseys. It's just wasn't part of my childhood.

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Speaker 1: I wasn't huge into sports. You didn't even grow up

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Speaker 1: wearing pants, So I grew up in the in the

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Speaker 1: woods naked. You're one of the woodland people. Is that

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Speaker 1: a boy that lives in his eyes? Every once in

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Speaker 1: a while, they're like feral children. No, but dude, jerseys

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Speaker 1: are so expensive. And I was curious because I was

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Speaker 1: thinking about it. Back when we used to go to

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Speaker 1: the Braids all the time when they're in town. You know,

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Speaker 1: you always had Atlanta Braves jersey. Uh and you would

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Speaker 1: always rag me if for not having any any of

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Speaker 1: like team gear. But I wasn't gonna spend the money

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Speaker 1: on I mean close to like a hundred bucks on

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Speaker 1: a on a nice jersey, you know. And this past

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Speaker 1: Christmas scored a sweet you know, official jersey, which I'm

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Speaker 1: super stoked about. Uh So, how do you justify that?

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Speaker 1: You know, you've got something you support and love your team,

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Speaker 1: but then on the other hand, you've got crazy ments

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Speaker 1: of jersey and they changed to you. That's what's so

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Speaker 1: crazy is that every every couple of years. Uh. I

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Speaker 1: mean some some leagues they're even required to update their jerseys. Yeah,

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Speaker 1: give me your thoughts, all right. So here's how I

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Speaker 1: approach stuff. Like buying a jersey. That is something I

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Speaker 1: typically will not buy for myself because of the expense.

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Speaker 1: And I usually ask for something like a jersey or

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Speaker 1: a hat or something like that for a team that

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Speaker 1: I love and follow, for Christmas or for my birthday.

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Speaker 1: So that's usually like I did, yeah exactly, I like

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Speaker 1: put it on the list and I know that I

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Speaker 1: want something like that. So you know, it was my

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Speaker 1: birthday in February and my folks got me one Atlanta

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Speaker 1: United jersey. And then I had some birthday money and

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Speaker 1: I decided found a sale and I bought another one.

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Speaker 1: So those are the two that I'll need for hopefully

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Speaker 1: the next three seasons because I don't mind wearing last

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Speaker 1: year's or two years ago jersey, but um, it is

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Speaker 1: nice to have that just to support my team, and

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Speaker 1: then to have an alternate one in case I like

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Speaker 1: completely sweated that one out or something. True, I feel

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Speaker 1: like I can wear an old jersey as almost like

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Speaker 1: a point of pride and be like, yeah, I'm not

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Speaker 1: gonna buy that new one. And as well, we're not

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Speaker 1: super super cheap. We we're not willing to spend money

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Speaker 1: on something that we really love. All right, let's move

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Speaker 1: on to the beer. We're over at my house tonight

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Speaker 1: recording and a palatial alt Mixed studios. We've been over

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Speaker 1: at your place that like past three three or four episodes,

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Speaker 1: and I actually have really liked it because it's a

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Speaker 1: nice pick me up to bike over to your place

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Speaker 1: in the in the cool night air. But I've been

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Speaker 1: biking a lot lately, so I'm actually glad to not

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Speaker 1: be on the bike today. See. I like doing it

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Speaker 1: at your house because when I get bored looking at

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Speaker 1: your face I can look at your great Dane in

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Speaker 1: the corner there and just yeah, she's she's a good dog.

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Speaker 1: She's sweet. But yeah, you so you brought over a

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Speaker 1: beer oak aged vanilla worldwide stout yep from dog fish

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Speaker 1: Head Doctor's Head, and they're freaking awesome and big thanks

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Speaker 1: to my friend Ryan. Yeah he he hooked you up.

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Speaker 1: Yeah he. His wife is from Delaware, and so when

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Speaker 1: he goes up there every once in a while, which

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Speaker 1: that's where doctor Shed is, and he picks up some

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Speaker 1: good beers, and super kind of him to uh to

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Speaker 1: donate these uh, these beers to the podcast. And this

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Speaker 1: one weighs in at a super stout seventeen and a

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Speaker 1: half percent. Yeah, so if we start, I'm excited that

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Speaker 1: we each have our own, our own twelve ounces of

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Speaker 1: beer of this mom also a little worried by the

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Speaker 1: time we get to the end of the podcast. I

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Speaker 1: was gonna say, yeah, it fights ourselves a little bit

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Speaker 1: if at the end of the podcast we're slurring our

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Speaker 1: words as we deliver our final thought. That is I mean,

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Speaker 1: that's bigger than a lot of wines. Right, I don't

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Speaker 1: drink a ton of wine, but isn't wine like around

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Speaker 1: fifteen Yeah, exactly, it's beastly. Are you gonna crack these open?

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Speaker 1: Let's crack it? Mm hmmm, gonna be honest, as soon

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Speaker 1: as you crack it, you get like a boozy waft

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Speaker 1: through the air. It just smells like dark, dark beer.

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Speaker 1: And if I were to start a rock and roll band,

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Speaker 1: I call it boozy Waft. Hey man, you're going to

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Speaker 1: the Boozy Waft show tonight. Yeah. Those guys are awesome.

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Speaker 1: They do all justin Bieber covers. Right, I thought I

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Speaker 1: was the only fan. You know them too? So this

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Speaker 1: poores pitch black, nice caramel brown head. Oh man, it

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Speaker 1: smells sweet too, which makes me very excited. Yeah, it's

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Speaker 1: dark as night and I just had my first ship.

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Speaker 1: It's lovely. It's lovely, It's wow. The oak and the

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Speaker 1: vanilla come through super nicely, and the base stout is

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Speaker 1: just kind of that perfect level. It's not overly viscous.

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Speaker 1: And some of these like bigger stouts, they're like you

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Speaker 1: almost have to choose them because they're so big and burly.

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Speaker 1: That's a nice body for for such a big beer.

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Speaker 1: I was expecting it to be a little superhier. Yeah,

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Speaker 1: this one's this one slides down nice and uh, really

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Speaker 1: really beautiful. Yeah. I mean, look at the carbonation for

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Speaker 1: for such a big stout like this, I'm actually surprised

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Speaker 1: at the amount of carbonation I've got coming up. Yeah.

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Speaker 1: Sometimes these beers like this poor with almost zero had

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Speaker 1: like no carbonation, and so you're just like literally feels like, um,

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Speaker 1: it looks like old oil, it looks like motor oil,

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Speaker 1: and it kind of has that feel in your mouth

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Speaker 1: to this one does not. It's got a kind of

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Speaker 1: a nice lively jump. Dude. I'm really glad you brought

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Speaker 1: this over too, because it's been pretty cold lately. We've

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Speaker 1: kind of had a cold streak here late in the spring,

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Speaker 1: and you know, when it's cold outside, it's nice to

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Speaker 1: have a big kind of warming beer like this because

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Speaker 1: I can already feel it in my belly. Yeah, like

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Speaker 1: a stout booze in my belly. I'm not really feeling

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Speaker 1: stouts in July and August, but when it's you know,

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Speaker 1: thirty five degrees outside, I'm all about it. Stouts and

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Speaker 1: barley wines are two of my favorite winter style beers.

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Speaker 1: Um And actually one of our listeners wrote in and

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Speaker 1: he had some questions about barley wines. So if you

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Speaker 1: have questions about beer styles or you just want to

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Speaker 1: talk more about it, I feel free to join our

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Speaker 1: Facebook group or email us. But our Facebook group is

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Speaker 1: the perfect place to ask questions and kind of engage

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Speaker 1: on topics related to beer and money. Um. But bar

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Speaker 1: wines and stouts two of my favorites to drink during

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Speaker 1: the cold months. So thanks to Ryan for donating these

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Speaker 1: beers to the podcast. Dude, it's awesome. I really appreciate it. Uh.

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Speaker 1: And on that note, Matt, let's get into how to

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Speaker 1: improve your credit score. So the credit score, let's first

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Speaker 1: talk about actually what that is, right, Yeah, So it's yeah,

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Speaker 1: it's important to note the definitions and a credit score.

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Speaker 1: It feels like the super secretive thing. And for years

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Speaker 1: and years and years, it kind of was secretive. It

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Speaker 1: was really hard to get your credit score. Back before

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Speaker 1: the Internet, people didn't know what made up a credit score, right, Yeah,

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Speaker 1: they didn't know what made it up, and they didn't

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Speaker 1: really have access to it. And that's changed over the years.

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Speaker 1: I mean I even remember ten years ago, I used

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Speaker 1: to bank with a bank called Washington Mutual that is

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Speaker 1: now difficult. Yeah, I remember them, and they one of

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Speaker 1: their parks was we'll give you access to your credit score,

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Speaker 1: and nobody else was doing that. And I was like

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Speaker 1: super pump because I'm a nerd and I wanted to

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Speaker 1: know about it, um and so that was really fun

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Speaker 1: for me, Like, I want to see that stats. And uh,

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Speaker 1: fortunately now we live in an age where you have

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Speaker 1: access to it and will tell you kind of how

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Speaker 1: that works later on and where to go to get

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Speaker 1: that um. But essentially, a credit score is a tool

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Speaker 1: that financial institutions use in order to decide whether they

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Speaker 1: should lend you money or not, and typically is referred

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Speaker 1: to as as the FICO score f I CEO. There's

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Speaker 1: three main players that you've heard of, and all those

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Speaker 1: kind of play into they're all weighted and create your

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Speaker 1: FICO score. But experience TransUnion and Equifax, the ladder of

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Speaker 1: which had a huge UH data breach last year and

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Speaker 1: stunk it up bags Yeah, good jog bays. This episode

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Speaker 1: is brought to you by Equifax. Yeah. And the other

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Speaker 1: thing is too, is there are are a lot of

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Speaker 1: different credit scores out there. There's different algorithms, Different companies

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Speaker 1: have their own sort of proprietary scores. They're all roughly

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Speaker 1: the same. They all typically have UH fall sort of

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Speaker 1: within the range of like three hundred or three fifty

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Speaker 1: to up to fifty and some go up to nine. Yeah,

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Speaker 1: there's there's they're all sort of different, but they all

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Speaker 1: operate around the sort of the same principles. And that's

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Speaker 1: what we're gonna be talking about today. And so yeah,

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Speaker 1: you might get UH one credit score from one place

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Speaker 1: and one credit score from another place, and they're gonna

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Speaker 1: be a little bit different, and you're like, well, what's

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Speaker 1: going on? Uh? And it's just because these different credit

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Speaker 1: bureaus have their, like Matt said, their own algorithms, and

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Speaker 1: they are essentially waiting things slightly differently but there are

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Speaker 1: a ton of principles that you can lean in in, uh,

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Speaker 1: in order to help you understand how to how your

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Speaker 1: credit score is made up and therefore how to make

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Speaker 1: your credit score great. So, like we said, your credit

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Speaker 1: score is how financial institutions are going to decide whether

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Speaker 1: to lend you money. So good credit score means more

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Speaker 1: favorable interest rates. It means yes, you're going to get

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Speaker 1: that long and I mean that's why this is important

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Speaker 1: is because this affects how much you're paying an interest

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Speaker 1: based on the right that the bank or whatever financial

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Speaker 1: institution you're working with is going to give you back.

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Speaker 1: In old school human society, a credit score was essentially

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Speaker 1: knowing somebody and knowing their trustworthiness. And now, because like

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Speaker 1: there's three million people in this country, you have to

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Speaker 1: have a score assigned to you because you walk into

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Speaker 1: your local bank and they don't know, you know, Matt

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Speaker 1: all makes pays his bills or not. Uh, And that's

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Speaker 1: why there's this score assigned to you to kind of

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Speaker 1: let them know, oh, well, Matt's paid all these other

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Speaker 1: bills on time and uh, and he's he seems to

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Speaker 1: have used it well his credit Well, so you know

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Speaker 1: what he's trustworthy and we can lend to him, whereas

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Speaker 1: you know before in early human days, it's like that

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Speaker 1: guy sleeps in really late and he was really contribute

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Speaker 1: to the meals at night. So he's saying, back then,

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Speaker 1: I would not have gotten a good a good loan,

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Speaker 1: but but maybe today I would exactly exactly what I'm

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Speaker 1: trying to say, jerk. Why do you need a good

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Speaker 1: credit score? Yeah, I mean so essentially, I mean, just

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Speaker 1: like you're saying it, it establishes basically your financial reputation

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Speaker 1: is maybe the best way to kind of describe it.

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Speaker 1: And it's not to be overlooked. I used to be

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Speaker 1: huge into Dave Ramsey, maybe about ten years ago, and

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Speaker 1: he used to call the FICO score the I Love

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Speaker 1: Debt score, because this whole thing is obvious. You know,

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Speaker 1: everybody knows get out of debt, that's the inside debt,

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Speaker 1: that's his whole stick. And I was all about that.

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Speaker 1: I was like, Oh, that's cool. I mean, I had

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Speaker 1: a FICO score because I we'd always used I use

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Speaker 1: credit card since I was a teenager. But I didn't

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Speaker 1: really care about my score until we started applying for

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Speaker 1: loans to buy a house and then I realized, Oh,

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Speaker 1: I'm glad I've got a pretty good credit score, because

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Speaker 1: otherwise that would affect me negatively big time and the

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Speaker 1: kind of loan that we could get, and especially as

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Speaker 1: a self employee person, we don't have regular income, and

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Speaker 1: so because of that, banks are super nervous when it

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Speaker 1: comes to lending to someone like me. I've got a

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Speaker 1: very variable income and they do not like that. It's

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Speaker 1: very hard to get alone when you're self employed, and

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Speaker 1: because of that, having a good credit score is huge. Yeah,

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Speaker 1: it means even more for you than it does for

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Speaker 1: the average person that can kind of rely a little

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Speaker 1: more on their paycheck history and they can say, listen,

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Speaker 1: this is how much I have coming in every month

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Speaker 1: and point to that. And granted they still need a

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Speaker 1: decent credit score as well, but for you, the credit

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Speaker 1: score means even more. Yeah. When they're employed by g E,

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Speaker 1: you know, the bank's like, okay, it'll be cool, Yeah, okay,

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Speaker 1: you're you have written normal employment and steady employment for

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Speaker 1: UH an employer that is going to be around for

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Speaker 1: a while, and that that helps a lot. But like

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Speaker 1: you alluded to as well, Matt, this credit score has

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Speaker 1: actually spidered its way into almost every element of life.

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Speaker 1: So essentially your credit score will affect your loan rate.

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Speaker 1: So you apply for a mortgage, a car loan, anything

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Speaker 1: like that credit card, you're that makes sense, Yeah, you're right,

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Speaker 1: that makes sense. It's gonna affect that you. You know,

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Speaker 1: if you have a credit score of seven eighty, you're

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Speaker 1: going to essentially probably get the best mortgage rate possible,

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Speaker 1: which might be let's say four percent, and someone with

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Speaker 1: much lower credit score six twenty might essentially be paying

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Speaker 1: four point seven five, like a huge gap, which it

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Speaker 1: would have have a point or full point onto a

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Speaker 1: prime which could cost you dollars over the life of

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Speaker 1: loan over thirty years. So that's easily it's a huge factor, right,

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Speaker 1: So you want to make sure that your credit scores

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Speaker 1: buttoned up for things like that. Also renting a home,

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Speaker 1: So if you haven't bought a home, if you're not

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Speaker 1: interested in buying home, and you're a renter, your perspective,

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Speaker 1: landlord is probably likely should be checking your credit. As

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Speaker 1: we talked about in our Laura Investment Property episode Investment

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Speaker 1: Property Basics, we touched on it then, uh and even

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Speaker 1: now though, would you consider running though two two renters

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Speaker 1: that have kind of low or like a bad with

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Speaker 1: with bad credit. Yeah, I totally would if they check

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Speaker 1: out in some of the other ways that I do

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Speaker 1: tenant screening, And eventually we'll do a whole podcast on

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Speaker 1: tenant screening, because that's what I want to do a

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Speaker 1: big thing too. But yeah, essentially I would, but they'd

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Speaker 1: have to meet some other parameters and probably provide a

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Speaker 1: bigger security deposit so that you know, I'm ensured essentially

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Speaker 1: in that way. And so yeah, just be ready for that.

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Speaker 1: If you're running home if you have a low credit score,

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Speaker 1: you might especially be paying a larger security deposit, and

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Speaker 1: some landlords might turn you away altogether just because you

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Speaker 1: have a bad credit score rating. Yeah. And and then

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Speaker 1: I saw too how different companies and even employers are

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Speaker 1: taking your credit score and account when it comes to

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Speaker 1: like getting a job. Man, I didn't actually even realize

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Speaker 1: this until recently. Um, but employers are literally checking your

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Speaker 1: credit score when they're I mean when in the hiring process,

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Speaker 1: which seems really weird. In some jobs, it makes sense,

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Speaker 1: like if you are handling a lot of money or

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Speaker 1: could be. I guess essentially the way it started off

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Speaker 1: with certain employers said, you know, what this person needs

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Speaker 1: to have good credit and good financial standing because they

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Speaker 1: can be subject to blackmail and they're handling company funds,

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Speaker 1: they might be forced into using company funds to cover

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Speaker 1: up for some of their financial indiscretions. And so that

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Speaker 1: was why it started, but it's really breached out into

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Speaker 1: other areas of hiring and people are having to give

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Speaker 1: their credit scores for jobs that really they shouldn't have

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Speaker 1: to be giving their Yeah, letting their employer to know

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Speaker 1: their credit score for yeah, to me, that just seems

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Speaker 1: really weird. I totally get it. I guess in some

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Speaker 1: financial institutions that you know, if you're like getting for

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Speaker 1: a major stockbroker or something like, yeah, exactly exactly, But

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Speaker 1: what does the credit score have anything to do with, say,

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Speaker 1: like like a doctor, or like a hospital hiring a doctor,

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Speaker 1: or a lot of positions where money just really isn't

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Speaker 1: that important when it comes to how well they can

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Speaker 1: do their job. Honestly, a big reason that you were

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Speaker 1: maybe even able to get that job, they had to, say,

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Speaker 1: finance their student loans and you know, things like that,

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Speaker 1: and maybe they're a little bit behind and they're not

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Speaker 1: doing the the different programs that are offered out there. Yeah,

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Speaker 1: I think it should be out of bound. Kind of

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Speaker 1: weird for for most employers, and and obviously for some

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Speaker 1: employers in some positions that should be waived. But yeah,

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Speaker 1: I agree with you. I think it's it's kind of

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Speaker 1: messed up that it's that much a part of the

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Speaker 1: hiring process more and more. And another way that we

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Speaker 1: think is kind of messed up that your credit scores

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Speaker 1: used is in setting your insurance rates, and so your

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Speaker 1: insurance premium him are going to be based sometimes in

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Speaker 1: large part, based on your credit score. We're talking like

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Speaker 1: health insurance, life insurance, car insurance, car insurance, and home

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Speaker 1: insurance most especially. Yeah, and so so some studies have

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Speaker 1: shown that someone with a great credit score and a

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Speaker 1: d u I on the record will get a better

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Speaker 1: insurance rate than someone with really poor credit but no

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Speaker 1: d u I, no bad driving record. And that's for

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Speaker 1: car insurance, for car insurance. It seems so backwards, dude. Yeah, man,

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Speaker 1: So that's how far the credit score has gone into

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Speaker 1: our society. It means so much, and it goes everywhere.

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Speaker 1: It affects you know, whether you can get a job,

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Speaker 1: and your insurance premiums, and it's crazy, whether you can

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Speaker 1: run a home, and how much you're gonna pay on

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Speaker 1: your mortgage if you buy a home, and so it's

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Speaker 1: so far reaching that that's the importance behind having a

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Speaker 1: good credit score. Yeah, I mean like it, like it

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Speaker 1: or not. Basically, it's becoming something that you need to

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Speaker 1: pay attention to. Even if say you buy homes in

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Speaker 1: cash and you're just kind of flush. It's something that

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Speaker 1: you need to consider because it does affect a lot

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Speaker 1: of aspects of your life. Yeah, if you are like

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Speaker 1: Richard Branson, rich you probably don't need to worry about

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Speaker 1: your credit score, but otherwise you need to know. And

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Speaker 1: one last thing randomly, I read this story recently that

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Speaker 1: having bad credit can actually hurt you when it comes

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Speaker 1: to you dating. So, Matt, we don't have to worry

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Speaker 1: about this because we're married. But if you're out there

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Speaker 1: and you're still flipping through tender trying to find a

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Speaker 1: significant other, or is there a field like on tender

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Speaker 1: where you like, you like enter ear and enter in

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Speaker 1: your age and then after that, like your credit score,

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Speaker 1: don't I don't know. I'm happily married, so I haven't

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Speaker 1: been on tender yet, but uh, you know, I don't

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Speaker 1: think so. But it was interesting that most people said,

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Speaker 1: because again, you know, we we we talked about how

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Speaker 1: it's kind of this indicating factor, the credit score of

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Speaker 1: your trustworthiness, and so people when they're dating someone else,

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Speaker 1: they were asked the question, you know, would you date

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Speaker 1: someone with an awful credit score? And most people were like,

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Speaker 1: no way, and essentially saying that I don't really trust

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Speaker 1: people that have a terribly low credit right, it's so crazy. Yeah,

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Speaker 1: what it's thaying is that in the same way that

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Speaker 1: businesses and insurance companies are sort of screening people, I mean,

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Speaker 1: I guess, uh, folks that are out in the dating

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Speaker 1: pool were doing the same thing. And that's interesting. I mean,

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Speaker 1: looking back, it's weird to that long long time ago.

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Speaker 1: You know, when we were dating people. If someone would

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Speaker 1: come up to me and you know, introduce themselves and

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Speaker 1: they seem really nice or whatever, but they were like,

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Speaker 1: my credit score is probably would have been like, okay,

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Speaker 1: you know what I mean, you're a total nerd so too. Yeah,

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Speaker 1: but I didn't assume most of what that was back then,

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Speaker 1: Whereas I feel like I had an idea of what

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Speaker 1: makes up your credit score and like what it means

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Speaker 1: but in general, I feel like a lot more has

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Speaker 1: kind of come out recently about your credit score and

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Speaker 1: what and what it means for you than it did

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Speaker 1: back then. Yeah, for sure. Like like we said at

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Speaker 1: the beginning, I mean think in the last ten years,

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Speaker 1: a lot of change when it comes to credit scores.

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Speaker 1: There's a lot more transparency, and we're we have easy

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Speaker 1: access toward scores. The world has changed a lot in

428
00:21:00,680 --> 00:21:04,680
Speaker 1: the last ten years. Drill Apparently I was cryogenically frozen,

429
00:21:05,160 --> 00:21:09,160
Speaker 1: so I missed some of it. You and Harrison Ford exactly.

430
00:21:10,000 --> 00:21:12,800
Speaker 1: So yeah, if you are in the dating world, pick

431
00:21:12,840 --> 00:21:15,640
Speaker 1: up your credit score so you can pick up more

432
00:21:15,720 --> 00:21:18,399
Speaker 1: of the opposite gender. So next we're gonna talk about

433
00:21:18,520 --> 00:21:20,840
Speaker 1: basically how to improve your credit score, how to get

434
00:21:20,880 --> 00:21:23,040
Speaker 1: a higher credit score, what you can steps you can

435
00:21:23,040 --> 00:21:26,360
Speaker 1: take that can improve that. And by doing that, we're

436
00:21:26,359 --> 00:21:28,960
Speaker 1: gonna be explaining the makeup of what what you know,

437
00:21:28,960 --> 00:21:30,720
Speaker 1: what goes into a credit score. So we're gonna talk

438
00:21:30,760 --> 00:21:33,960
Speaker 1: about the things that the different companies take into account

439
00:21:34,000 --> 00:21:36,440
Speaker 1: when they're creating your credit score, and we're also gonna

440
00:21:36,440 --> 00:21:39,040
Speaker 1: talk about how to improve those things. And the number

441
00:21:39,359 --> 00:21:43,639
Speaker 1: one thing, and it's weighted averages essentially that they that

442
00:21:43,680 --> 00:21:46,040
Speaker 1: they factor in. So the number one thing that credit

443
00:21:46,040 --> 00:21:49,760
Speaker 1: scoring companies are looking at is your payment history. Yeah,

444
00:21:49,800 --> 00:21:52,280
Speaker 1: of course, duh right. So what that means is that

445
00:21:52,440 --> 00:21:54,439
Speaker 1: if you have payments on a credit card or a

446
00:21:54,440 --> 00:21:57,359
Speaker 1: car loan or student loans even as well, Uh, you

447
00:21:57,400 --> 00:21:59,880
Speaker 1: need to be paying on time or early. That's how

448
00:22:00,000 --> 00:22:03,840
Speaker 1: you're going to keep these different companies happy. Uh, And

449
00:22:03,880 --> 00:22:05,800
Speaker 1: that's how you're going to make sure your payment history

450
00:22:06,040 --> 00:22:10,679
Speaker 1: is is in the clear. And this becomes especially bad.

451
00:22:10,880 --> 00:22:12,520
Speaker 1: If you're you know, a few days late, it's not

452
00:22:12,600 --> 00:22:14,719
Speaker 1: the big of a deal, or even thirty days later

453
00:22:14,760 --> 00:22:16,600
Speaker 1: it might be a small ding. But if you get

454
00:22:16,680 --> 00:22:20,399
Speaker 1: to ninety days late and get essentially delinquent on a

455
00:22:20,400 --> 00:22:23,840
Speaker 1: credit card payment or on a bill payment, uh, that

456
00:22:23,920 --> 00:22:26,280
Speaker 1: can it's really bad. That can really hurt your credit

457
00:22:26,400 --> 00:22:29,320
Speaker 1: in a big way. And if you have a few

458
00:22:29,359 --> 00:22:31,720
Speaker 1: of those on there, that can stay on your credit

459
00:22:31,760 --> 00:22:34,440
Speaker 1: score for seven years and can we really put a

460
00:22:34,520 --> 00:22:37,240
Speaker 1: hurting on you. You start getting out to ninety days

461
00:22:37,240 --> 00:22:41,320
Speaker 1: out to eight days, six months, and different companies will

462
00:22:41,359 --> 00:22:42,800
Speaker 1: start it's just I mean, they call it a charge

463
00:22:42,800 --> 00:22:45,520
Speaker 1: off and basically they consider your debt or your you know,

464
00:22:45,560 --> 00:22:48,240
Speaker 1: your payment uncollectable because they're like, well they haven't paid,

465
00:22:48,400 --> 00:22:51,920
Speaker 1: they're probably not going to pay, and that really really

466
00:22:51,960 --> 00:22:54,960
Speaker 1: negatively affects your your credit score. And like we said earlier,

467
00:22:55,000 --> 00:22:58,000
Speaker 1: your payment history, paying on time or paying early makes

468
00:22:58,080 --> 00:23:01,800
Speaker 1: up of your credit score. So that is hugely important

469
00:23:02,440 --> 00:23:04,919
Speaker 1: and matt Essentially, the time frame that you need to

470
00:23:04,920 --> 00:23:07,359
Speaker 1: know that could have impact your credit score is the

471
00:23:07,359 --> 00:23:09,600
Speaker 1: thirty day mark, in the ninety day mark. And while

472
00:23:09,800 --> 00:23:14,920
Speaker 1: some institutions that you have credit through won't report anything

473
00:23:15,000 --> 00:23:18,159
Speaker 1: until it h's sixty days late, be cognizant that most

474
00:23:18,359 --> 00:23:21,919
Speaker 1: will at thirty days ding a mark on your credit score.

475
00:23:22,200 --> 00:23:24,360
Speaker 1: It could drop your score by a hundred and ten

476
00:23:24,400 --> 00:23:28,040
Speaker 1: points that one mark, And so if you're thirty days late,

477
00:23:28,240 --> 00:23:30,720
Speaker 1: that could be a big problem. Let's say you're shopping

478
00:23:30,760 --> 00:23:32,800
Speaker 1: for a house or a car and you're just about

479
00:23:32,800 --> 00:23:35,480
Speaker 1: to get alone and your your credit score drops a

480
00:23:35,560 --> 00:23:39,520
Speaker 1: hundred and ten points. That could severely impact first whether

481
00:23:39,560 --> 00:23:41,199
Speaker 1: you can even get the loan, and second the rate

482
00:23:41,200 --> 00:23:43,199
Speaker 1: you're gonna pay. Yeah, you may not even qualify for

483
00:23:43,240 --> 00:23:46,080
Speaker 1: that at all. Yeah, So your payment history is huge.

484
00:23:46,080 --> 00:23:48,760
Speaker 1: It's the number one factor. Uh, thirty days late is

485
00:23:48,800 --> 00:23:51,760
Speaker 1: really important to avoid and ninety days later is the

486
00:23:51,800 --> 00:23:53,959
Speaker 1: most important to avoid. And like we said, that can

487
00:23:54,000 --> 00:23:56,920
Speaker 1: stay on your credit report for up to seven years,

488
00:23:57,320 --> 00:24:00,359
Speaker 1: so it can hurt you for a long long time. Further,

489
00:24:00,440 --> 00:24:03,040
Speaker 1: it gets away from being marked up on your credit

490
00:24:03,040 --> 00:24:05,000
Speaker 1: report like a few a few years later. Yeah, the

491
00:24:05,040 --> 00:24:08,600
Speaker 1: better you are, it'll lesson the sting, will lessen fade. Yeah,

492
00:24:08,640 --> 00:24:10,879
Speaker 1: but it will be there and people will see it

493
00:24:10,920 --> 00:24:13,239
Speaker 1: and it will continue to hurt the actual score. And

494
00:24:13,280 --> 00:24:15,760
Speaker 1: so you want to make sure you're paying your bills

495
00:24:15,840 --> 00:24:18,919
Speaker 1: and your debts on time. So the next piece of

496
00:24:18,920 --> 00:24:21,800
Speaker 1: the pie, the next biggest factor that goes into your

497
00:24:21,800 --> 00:24:25,960
Speaker 1: credit score is the amount you oh or like most

498
00:24:26,000 --> 00:24:29,439
Speaker 1: oftentimes too is referred to as your utilization, right, So

499
00:24:29,480 --> 00:24:32,640
Speaker 1: this is where your limits come into play. Let's say

500
00:24:32,640 --> 00:24:34,760
Speaker 1: you have a credit card with a five thousand dollar

501
00:24:34,840 --> 00:24:38,239
Speaker 1: limit and you are using four thousand dollars of that

502
00:24:38,280 --> 00:24:40,919
Speaker 1: limit every month. You're charging four thousand. Even if you

503
00:24:40,960 --> 00:24:44,600
Speaker 1: pay it off every every month in full, you're still

504
00:24:44,680 --> 00:24:47,720
Speaker 1: getting bingked because you're using a high level of your

505
00:24:47,760 --> 00:24:50,720
Speaker 1: available credit. So if you have a five thousand dollar

506
00:24:50,840 --> 00:24:54,359
Speaker 1: limit on your card and you are using five hundred

507
00:24:54,440 --> 00:24:57,080
Speaker 1: dollars every month and paying it off in full. Yeah,

508
00:24:57,119 --> 00:24:59,119
Speaker 1: that's more like it. That is going to be the

509
00:24:59,160 --> 00:25:03,120
Speaker 1: sweet spot in significantly help your credit score because you're

510
00:25:03,160 --> 00:25:06,159
Speaker 1: only utilizing a small amount of your available credit. And

511
00:25:06,200 --> 00:25:11,240
Speaker 1: this credit utilization factor is a full thirty of what

512
00:25:11,320 --> 00:25:14,959
Speaker 1: influences your credit score. So combine the credit utilization with

513
00:25:15,040 --> 00:25:18,040
Speaker 1: your payment history, that makes up almost two thirds of

514
00:25:18,080 --> 00:25:20,200
Speaker 1: your score. So these are the biggest two factors that

515
00:25:20,240 --> 00:25:22,040
Speaker 1: play into having a high credit score. You know, you

516
00:25:22,119 --> 00:25:24,200
Speaker 1: touched on some of the percentages there, but some other

517
00:25:24,200 --> 00:25:27,440
Speaker 1: percentages too. Is that like you said five for five thousand.

518
00:25:28,119 --> 00:25:31,119
Speaker 1: You said that because that gets us to that is

519
00:25:31,160 --> 00:25:33,200
Speaker 1: the magical number. Yeah, that's that's kind of a key,

520
00:25:33,359 --> 00:25:37,000
Speaker 1: a key percentage right there. A lot of folks will say,

521
00:25:37,320 --> 00:25:40,920
Speaker 1: and that's definitely great, that's that's safe. Being below thirty

522
00:25:41,040 --> 00:25:43,160
Speaker 1: is like getting a be on a paper. Yeah, being

523
00:25:43,240 --> 00:25:45,600
Speaker 1: at ten per center below is like getting a plus. Yeah.

524
00:25:45,640 --> 00:25:48,320
Speaker 1: Different experts are now saying that essentially the lower you

525
00:25:48,320 --> 00:25:50,960
Speaker 1: can get it, the better because creditors they want to

526
00:25:51,000 --> 00:25:54,159
Speaker 1: see that like, yes, you qualify for that loan or

527
00:25:54,160 --> 00:25:56,280
Speaker 1: that credit card, but you're not really using it because

528
00:25:56,320 --> 00:26:00,639
Speaker 1: you don't really need it. Your fancy and essentially that

529
00:26:00,920 --> 00:26:02,639
Speaker 1: it seems that the lower you can you can get it,

530
00:26:03,200 --> 00:26:05,280
Speaker 1: the better. There are no like sort of hard fast

531
00:26:05,359 --> 00:26:09,200
Speaker 1: rules because again all these different companies have different formulas

532
00:26:09,240 --> 00:26:11,959
Speaker 1: and sort of different algorithms that go into creating your

533
00:26:11,960 --> 00:26:16,080
Speaker 1: credit score. But that is pretty clear that the lower

534
00:26:16,119 --> 00:26:19,800
Speaker 1: you can keep your credit utilization rate the better. Yeah,

535
00:26:19,840 --> 00:26:22,879
Speaker 1: and they're kind of secretive sometimes about exactly what comprises,

536
00:26:23,680 --> 00:26:25,879
Speaker 1: uh some of the specifics on these right, so that

537
00:26:26,240 --> 00:26:28,159
Speaker 1: FICO is not coming out and saying and experience not

538
00:26:28,200 --> 00:26:31,040
Speaker 1: coming out and saying this is exactly the percentage you

539
00:26:31,040 --> 00:26:33,560
Speaker 1: should stay under to have the maximum score. So some

540
00:26:33,640 --> 00:26:37,000
Speaker 1: of these things are people know from kind of experience

541
00:26:37,000 --> 00:26:39,040
Speaker 1: and looking at their own scores and studies that have

542
00:26:39,080 --> 00:26:41,200
Speaker 1: been done about credit scores and some of the things

543
00:26:41,200 --> 00:26:44,160
Speaker 1: that the actual credit bureaus have put out themselves as well.

544
00:26:44,440 --> 00:26:46,879
Speaker 1: We have a really good understanding, but we don't have

545
00:26:46,960 --> 00:26:49,639
Speaker 1: a perfect understanding that we can say these are the

546
00:26:49,760 --> 00:26:53,119
Speaker 1: hard and fast rules. But from what we've experienced and

547
00:26:53,160 --> 00:26:57,000
Speaker 1: seen and read, under ten percent credit utilization is going

548
00:26:57,040 --> 00:26:59,679
Speaker 1: to be the sweet spot for you. So it's hit

549
00:26:59,760 --> 00:27:01,840
Speaker 1: then as a way to be able to keep your

550
00:27:01,920 --> 00:27:05,720
Speaker 1: your utilization rate lower is check in with your credit

551
00:27:05,760 --> 00:27:07,719
Speaker 1: card and see if you can up your limit, if

552
00:27:07,720 --> 00:27:10,439
Speaker 1: you kind of find yourself consistently, you know, pushing that

553
00:27:10,480 --> 00:27:13,800
Speaker 1: tin and even even more so that see if you

554
00:27:13,800 --> 00:27:17,119
Speaker 1: can increase your limit, and essentially you're utilizing less of

555
00:27:17,160 --> 00:27:19,320
Speaker 1: the credit that you're allowed to use. And I will

556
00:27:19,359 --> 00:27:21,760
Speaker 1: say that works and a lot of time if you're

557
00:27:21,880 --> 00:27:24,880
Speaker 1: handling your credit well. But sometimes if you reach out

558
00:27:24,880 --> 00:27:26,639
Speaker 1: to your credit card company and ask her a higher

559
00:27:26,640 --> 00:27:29,360
Speaker 1: limit while showing that you haven't handled credit very well

560
00:27:29,400 --> 00:27:31,640
Speaker 1: in the past, they might get a little worried. Yeah,

561
00:27:31,680 --> 00:27:34,800
Speaker 1: we won't want to look as good. Yeah, it will

562
00:27:34,840 --> 00:27:38,080
Speaker 1: affect your credit temporarily. It's weird because you need to

563
00:27:38,160 --> 00:27:39,760
Speaker 1: be able to do those things in order to increase

564
00:27:39,800 --> 00:27:41,199
Speaker 1: your limit, but at the same time, every time you

565
00:27:41,200 --> 00:27:44,040
Speaker 1: do that, it affects your credit score negatively. I like

566
00:27:44,119 --> 00:27:46,159
Speaker 1: to think of it almost as like you're opening the

567
00:27:46,200 --> 00:27:48,399
Speaker 1: fridge or like the freezer. It's like you got to

568
00:27:48,440 --> 00:27:49,879
Speaker 1: open it and see what's in there. It's sort of

569
00:27:49,880 --> 00:27:51,919
Speaker 1: like when you're kind of checking your credit score, and

570
00:27:51,920 --> 00:27:53,560
Speaker 1: it's going to kind of the lower the temperature a

571
00:27:53,600 --> 00:27:55,520
Speaker 1: little bit every time you do that. But like that's

572
00:27:55,560 --> 00:27:57,520
Speaker 1: what's necessary to get what you need out of the

573
00:27:57,600 --> 00:28:00,040
Speaker 1: fridge um and then that's a good way to it,

574
00:28:00,520 --> 00:28:02,240
Speaker 1: and then long term you'll be able to kind of

575
00:28:02,320 --> 00:28:05,399
Speaker 1: build from there. Yeah. So if you're handling your credit

576
00:28:05,440 --> 00:28:08,200
Speaker 1: pretty well, it's more than reasonable to reach out to

577
00:28:08,280 --> 00:28:10,520
Speaker 1: one of your credit card companies and say, hey, it's

578
00:28:10,520 --> 00:28:12,040
Speaker 1: just wondering if I could get a five thousand dollar

579
00:28:12,119 --> 00:28:15,120
Speaker 1: limit increase, and if they grant that to you, that

580
00:28:15,320 --> 00:28:18,719
Speaker 1: will definitely help your utilization rate. Just make sure that

581
00:28:18,760 --> 00:28:21,439
Speaker 1: once you get that increase in limit, that doesn't increase

582
00:28:21,440 --> 00:28:24,080
Speaker 1: your spending. Yeah. Just so those are the first two

583
00:28:24,240 --> 00:28:27,280
Speaker 1: factors that go into the makeup of your credit score.

584
00:28:27,320 --> 00:28:30,320
Speaker 1: What's the next one? The age of credit and the

585
00:28:30,440 --> 00:28:32,800
Speaker 1: length of your credit history. So this makes that fift

586
00:28:33,720 --> 00:28:37,959
Speaker 1: of your credit score, and essentially your creditors and the

587
00:28:38,040 --> 00:28:40,600
Speaker 1: financial institutions they want to see that you've had a

588
00:28:40,640 --> 00:28:44,440
Speaker 1: long history of paying your bills. So you eight year

589
00:28:44,440 --> 00:28:47,280
Speaker 1: olds out there, you better be crushing it on this. Okay,

590
00:28:47,520 --> 00:28:50,520
Speaker 1: there swollen on their history, Yeah they are, and on

591
00:28:50,560 --> 00:28:53,520
Speaker 1: the shuffle board. Yeah, I mean this one is it's

592
00:28:53,560 --> 00:28:57,000
Speaker 1: pretty simple. Essentially, the longer you've had accounts open where

593
00:28:57,000 --> 00:29:00,480
Speaker 1: you've paid on time and kind of kept up with it,

594
00:29:00,720 --> 00:29:03,120
Speaker 1: the better is gonna look. Um, when's when's the first

595
00:29:03,120 --> 00:29:05,239
Speaker 1: time you got a credit card? Remember when you when

596
00:29:05,280 --> 00:29:07,360
Speaker 1: your first credit card was? Gosh, I want to say

597
00:29:07,440 --> 00:29:11,920
Speaker 1: it was almost towards the end of college, okay, which

598
00:29:11,960 --> 00:29:13,600
Speaker 1: was probably good for me. I didn't know a whole

599
00:29:13,640 --> 00:29:15,640
Speaker 1: lot about money. I knew I was cheap, but I

600
00:29:15,680 --> 00:29:18,680
Speaker 1: didn't really know how to handle money at that point.

601
00:29:18,720 --> 00:29:19,920
Speaker 1: And so if I had gotten a credit card, I

602
00:29:20,240 --> 00:29:22,239
Speaker 1: don't think I would have bought crazy stuff, but I

603
00:29:22,280 --> 00:29:24,719
Speaker 1: wouldn't have known how to utilize credit well at the

604
00:29:24,760 --> 00:29:27,200
Speaker 1: age of like eighteen or nineteen. Yeah, it was twenty

605
00:29:27,240 --> 00:29:29,280
Speaker 1: because when I look at you, and we'll talk about

606
00:29:29,320 --> 00:29:30,480
Speaker 1: later how you can kind of look at some of

607
00:29:30,520 --> 00:29:33,240
Speaker 1: the details about your credit and some great resources to use.

608
00:29:33,400 --> 00:29:35,800
Speaker 1: But when I look at one of those resources, credit Carma,

609
00:29:36,200 --> 00:29:38,160
Speaker 1: it essentially tells me how long my credit history is,

610
00:29:38,200 --> 00:29:40,400
Speaker 1: and it's fourteen years. So I was twenty years old

611
00:29:40,400 --> 00:29:42,800
Speaker 1: when I got my first credit card. Nice man. Yeah,

612
00:29:42,840 --> 00:29:45,960
Speaker 1: I remember getting mine, and I think I had just

613
00:29:46,000 --> 00:29:49,680
Speaker 1: got my driver's license. But there's there's rules now as

614
00:29:49,680 --> 00:29:52,520
Speaker 1: far as what credit cards and what different companies are

615
00:29:52,600 --> 00:29:55,800
Speaker 1: able to offer teenagers. Do you know what those laws

616
00:29:55,800 --> 00:29:58,200
Speaker 1: are because I don't Yeah, you're not able to offer

617
00:29:58,640 --> 00:30:01,240
Speaker 1: people under the age of eighteen, Okay, that's credit cards anymore.

618
00:30:01,240 --> 00:30:03,240
Speaker 1: And so the sweet spot for you to get a

619
00:30:03,520 --> 00:30:05,720
Speaker 1: get a credit card, to sign up and you know,

620
00:30:05,760 --> 00:30:08,160
Speaker 1: if we have people listening who are aged eighteen to

621
00:30:08,200 --> 00:30:10,680
Speaker 1: twenty two and are in college, that's the time to

622
00:30:10,840 --> 00:30:13,000
Speaker 1: get credit and use it wisely. You start using it

623
00:30:13,040 --> 00:30:16,000
Speaker 1: wisely because once you get out of college, if you

624
00:30:16,040 --> 00:30:19,120
Speaker 1: don't have any credit history, it's tough. It's tough to

625
00:30:19,160 --> 00:30:21,240
Speaker 1: get a credit card, and it's tough to get started.

626
00:30:21,640 --> 00:30:23,880
Speaker 1: They're really willing to offer you credit if you're in

627
00:30:24,000 --> 00:30:27,000
Speaker 1: college as a student, or if you're you're just doing

628
00:30:27,080 --> 00:30:29,640
Speaker 1: that general age range, it's easier, but once you get

629
00:30:29,640 --> 00:30:31,640
Speaker 1: out of that, it's it becomes a lot harder to

630
00:30:31,720 --> 00:30:33,640
Speaker 1: get credit and established credit. So you're gonna want to

631
00:30:33,680 --> 00:30:35,840
Speaker 1: make sure you start it. Then. Yeah, they say, oh,

632
00:30:35,880 --> 00:30:37,840
Speaker 1: you're twenty three or twenty four, I see you have

633
00:30:37,840 --> 00:30:39,560
Speaker 1: a job. How come you've never had a credit card.

634
00:30:39,720 --> 00:30:41,560
Speaker 1: And it's sort of like this sort of catch twenty

635
00:30:41,560 --> 00:30:45,000
Speaker 1: two thing where you need to have credit to get credit,

636
00:30:45,280 --> 00:30:48,560
Speaker 1: but you should have a job before you start racking

637
00:30:48,680 --> 00:30:51,320
Speaker 1: up credit. Card debt. So if you're in college and

638
00:30:51,400 --> 00:30:54,320
Speaker 1: you get a credit card, really like buy your gas

639
00:30:54,880 --> 00:30:56,480
Speaker 1: with the credit card or something and pay that off

640
00:30:56,480 --> 00:30:59,040
Speaker 1: every month. But don't don't start willy nilly using it

641
00:30:59,080 --> 00:31:01,560
Speaker 1: all over the place. Be smart. And one other really

642
00:31:01,560 --> 00:31:04,520
Speaker 1: important thing to mention about the age of credit length

643
00:31:04,520 --> 00:31:08,200
Speaker 1: of credit history factor is people ask the question all

644
00:31:08,200 --> 00:31:11,640
Speaker 1: the time like should I close this credit card, And

645
00:31:11,680 --> 00:31:16,040
Speaker 1: the answer is almost always no, because this is an

646
00:31:16,080 --> 00:31:19,600
Speaker 1: important part of your credit score, and if you close

647
00:31:19,640 --> 00:31:23,120
Speaker 1: that card, it is essentially you are hurting. First, your

648
00:31:23,120 --> 00:31:27,200
Speaker 1: credit utilization basically brings down the total amount of credit

649
00:31:27,280 --> 00:31:30,600
Speaker 1: that you have been offered, right, So just increasing your

650
00:31:30,920 --> 00:31:34,080
Speaker 1: basically increasing your credit utilization rate. Yeah, and it also

651
00:31:34,240 --> 00:31:36,760
Speaker 1: then if you've had that credit card for a number

652
00:31:36,760 --> 00:31:39,600
Speaker 1: of years, it takes away from that that's been building

653
00:31:39,680 --> 00:31:43,520
Speaker 1: to this, adding to your length of history. So just

654
00:31:43,560 --> 00:31:45,440
Speaker 1: put it in a drawer somewhere or use it once

655
00:31:45,480 --> 00:31:47,680
Speaker 1: a year to kind of keep it mildly active. But

656
00:31:47,800 --> 00:31:50,160
Speaker 1: don't get rid of it altogether because if you do that,

657
00:31:50,200 --> 00:31:53,640
Speaker 1: you're gonna actually hurt your credit score. Unless you have

658
00:31:53,680 --> 00:31:56,040
Speaker 1: a credit card that has an annual fee. So if

659
00:31:56,080 --> 00:31:58,720
Speaker 1: you've got a like an annual fee on a card

660
00:31:58,760 --> 00:32:00,560
Speaker 1: that's just sitting around and you're not used it. Please

661
00:32:00,560 --> 00:32:03,000
Speaker 1: don't keep that around. Yeah, it'll it'll definitely doing your

662
00:32:03,000 --> 00:32:05,320
Speaker 1: credit to close it. But don't be so afraid to

663
00:32:05,320 --> 00:32:07,840
Speaker 1: close an account, uh that you're going to keep this

664
00:32:07,880 --> 00:32:10,120
Speaker 1: card sitting around that you're not using, that you're paying

665
00:32:10,160 --> 00:32:13,320
Speaker 1: every year on because they've got a stupid annual fee. Uh,

666
00:32:13,440 --> 00:32:14,920
Speaker 1: just because you don't want to hurt your credit. Yeah,

667
00:32:15,000 --> 00:32:17,400
Speaker 1: let's ding it a little bit, but it'll recover, it'll

668
00:32:17,400 --> 00:32:20,400
Speaker 1: be fine. Yeah. And let's say you're not shopping for

669
00:32:20,440 --> 00:32:23,880
Speaker 1: a car a mortgage in the next six months. Yes, uh,

670
00:32:24,000 --> 00:32:26,320
Speaker 1: then you can close a card like with an annual fee.

671
00:32:26,360 --> 00:32:27,480
Speaker 1: That's when you can do it. If you're in the

672
00:32:27,520 --> 00:32:29,800
Speaker 1: middle of shopping for something. Don't make any changes to

673
00:32:29,840 --> 00:32:32,640
Speaker 1: your credit, no big changes, no big changes. But if

674
00:32:32,680 --> 00:32:35,880
Speaker 1: you don't have anything that you're shopping for, go ahead,

675
00:32:36,080 --> 00:32:38,120
Speaker 1: close that card with the annual fee. Save the ninety

676
00:32:38,160 --> 00:32:40,720
Speaker 1: five dollars a year. You might, you know, drop twenty

677
00:32:41,160 --> 00:32:43,720
Speaker 1: pots in your credit score, but that will recover over

678
00:32:43,720 --> 00:32:46,240
Speaker 1: the next quick six months and be back close to normal.

679
00:32:46,680 --> 00:32:48,720
Speaker 1: So then the next one, man is the type of

680
00:32:48,720 --> 00:32:51,360
Speaker 1: credit that you have or like they basically your your

681
00:32:51,400 --> 00:32:54,080
Speaker 1: credit mix um. And so what we mean by that

682
00:32:54,280 --> 00:32:56,880
Speaker 1: is that creditors want to see that you have a

683
00:32:57,240 --> 00:33:01,040
Speaker 1: nice sort of portfolio essentially of credit that you've been offered.

684
00:33:01,200 --> 00:33:02,840
Speaker 1: Creditors want to see that you've got like you know,

685
00:33:02,920 --> 00:33:05,480
Speaker 1: like a mortgage, a car loan, credit card, student loans,

686
00:33:05,480 --> 00:33:07,640
Speaker 1: like all these different kinds of credit that you cant

687
00:33:07,680 --> 00:33:11,680
Speaker 1: imply for. It's just, I know, explaining this and thinking

688
00:33:11,720 --> 00:33:14,600
Speaker 1: through it, it is super weird. They're saying, you have

689
00:33:14,720 --> 00:33:16,880
Speaker 1: all this credit available to you, but don't use very

690
00:33:16,960 --> 00:33:18,840
Speaker 1: much of it. Have a whole equity line and a

691
00:33:18,880 --> 00:33:20,960
Speaker 1: mortgage in a credit card and blah blah blah blah blah,

692
00:33:21,200 --> 00:33:25,160
Speaker 1: but use like an incredibly infinitessimal amount of that credit

693
00:33:25,200 --> 00:33:28,920
Speaker 1: that is available to you. It's super weird. But this

694
00:33:29,040 --> 00:33:31,440
Speaker 1: is the way the credit scoring system works, how it's

695
00:33:31,480 --> 00:33:34,080
Speaker 1: made up. And you've got to play the game because

696
00:33:34,560 --> 00:33:36,400
Speaker 1: you really is like a game, isn't it. It's like

697
00:33:36,440 --> 00:33:38,280
Speaker 1: a game. It's like a game, and you want the

698
00:33:38,320 --> 00:33:41,000
Speaker 1: lowest rates, and so you've got to play this game, uh,

699
00:33:41,040 --> 00:33:44,000
Speaker 1: to get it right so that you're saving the most money. Yeah,

700
00:33:44,000 --> 00:33:46,880
Speaker 1: And that being said, this only makes up of your score.

701
00:33:47,040 --> 00:33:50,239
Speaker 1: So don't get a car loan just because you're thinking like, oh,

702
00:33:50,240 --> 00:33:51,760
Speaker 1: I want to get my credit score up, I want

703
00:33:51,760 --> 00:33:54,120
Speaker 1: to get my credit scoring by the car and get

704
00:33:54,120 --> 00:33:56,280
Speaker 1: a loan. Yeah, please do not do that. This is

705
00:33:56,280 --> 00:33:58,240
Speaker 1: only ten percent. So we're kind of getting down to

706
00:33:58,240 --> 00:34:00,719
Speaker 1: the bottom of the list now where these things aren't

707
00:34:00,800 --> 00:34:03,280
Speaker 1: you know, having nearly as much of an effect on

708
00:34:03,280 --> 00:34:06,280
Speaker 1: your credit score. It still has an impact, but you know,

709
00:34:06,440 --> 00:34:09,719
Speaker 1: nothing close to like your payment history or your utilization rate.

710
00:34:09,800 --> 00:34:12,560
Speaker 1: But if you do find find yourself having you know,

711
00:34:12,760 --> 00:34:15,760
Speaker 1: very few lines of credit, you know what, consider opening

712
00:34:15,840 --> 00:34:18,680
Speaker 1: up another credit card or two that don't have an

713
00:34:18,680 --> 00:34:20,520
Speaker 1: annual fee so that you know you're not gonna be

714
00:34:20,560 --> 00:34:23,160
Speaker 1: angry every year when you get that bill in the mail. Uh,

715
00:34:23,200 --> 00:34:25,759
Speaker 1: and take out those credit lines and just you know,

716
00:34:25,880 --> 00:34:29,760
Speaker 1: barely use them and pay them off. And so having

717
00:34:29,800 --> 00:34:33,720
Speaker 1: those extra lines of credit can help this ten percent factor,

718
00:34:34,040 --> 00:34:36,520
Speaker 1: and then over time can actually go to helping your

719
00:34:36,600 --> 00:34:38,600
Speaker 1: length of credit history as well. So it can kind

720
00:34:38,600 --> 00:34:41,520
Speaker 1: of have this like double whammy effect or triple wammy

721
00:34:41,600 --> 00:34:44,919
Speaker 1: essentially because it's helping your credit utilization at the same time.

722
00:34:45,600 --> 00:34:47,440
Speaker 1: All right, Matt, in the last factor, we're getting to

723
00:34:47,440 --> 00:34:50,320
Speaker 1: the bottom here is hard inquiries for new credit account

724
00:34:50,320 --> 00:34:53,040
Speaker 1: for ten percent of that piece of the pie when

725
00:34:53,040 --> 00:34:55,680
Speaker 1: it comes to your credit score. Yeah, basically, what would

726
00:34:55,719 --> 00:34:59,080
Speaker 1: mean by that is shopping for new credit. So whether

727
00:34:59,120 --> 00:35:03,080
Speaker 1: that means trying to get an Alan, uh, new car

728
00:35:03,120 --> 00:35:06,240
Speaker 1: loans so maybe a home equity loan. Maybe that means

729
00:35:06,440 --> 00:35:09,560
Speaker 1: kind of applying for a new credit card. These are

730
00:35:09,600 --> 00:35:12,600
Speaker 1: all hard inquiries on your credit. And what we mean

731
00:35:12,640 --> 00:35:14,799
Speaker 1: by that is an example of a soft inquiry is

732
00:35:15,120 --> 00:35:19,439
Speaker 1: you checking your credit score. Um, that's something that will

733
00:35:19,440 --> 00:35:22,360
Speaker 1: not affect your credit score long term and uh, and

734
00:35:22,719 --> 00:35:25,680
Speaker 1: you can do that, that's fine. However, applying for new

735
00:35:25,719 --> 00:35:32,200
Speaker 1: credit hard inquiry, and that will drop your credit temporarily.

736
00:35:32,200 --> 00:35:34,520
Speaker 1: It's not like a huge thing. Again, we're towards the

737
00:35:34,520 --> 00:35:37,360
Speaker 1: bottom of the list here and this is only but

738
00:35:37,880 --> 00:35:39,480
Speaker 1: keep that in mind. You don't want to just kind

739
00:35:39,480 --> 00:35:42,160
Speaker 1: of constantly shot for new credit cards. That being said,

740
00:35:42,480 --> 00:35:46,080
Speaker 1: in the past, I was looking before preparing for this podcast,

741
00:35:46,160 --> 00:35:50,600
Speaker 1: and I've got seven hard inquiries on what you're shopping for. Man,

742
00:35:51,280 --> 00:35:53,400
Speaker 1: So if you guys don't already know this, I'm a

743
00:35:53,400 --> 00:35:56,319
Speaker 1: super nerd and what that means is that I'm constantly

744
00:35:56,600 --> 00:36:00,319
Speaker 1: working the credit cards, the sign up bonuses, and there's

745
00:36:00,320 --> 00:36:02,520
Speaker 1: some sick bonuses out and you just took advantage of

746
00:36:02,520 --> 00:36:04,920
Speaker 1: a really great one. We're gonna do it an entire episode.

747
00:36:04,960 --> 00:36:07,320
Speaker 1: I think on on work in the credit card system,

748
00:36:07,360 --> 00:36:10,160
Speaker 1: I think, but I'm a big fan of doing that. Essentially,

749
00:36:10,200 --> 00:36:12,040
Speaker 1: every three months, I try to get into credit card

750
00:36:12,080 --> 00:36:15,279
Speaker 1: with like anywhere between a three to eight hundred dollar

751
00:36:15,560 --> 00:36:18,120
Speaker 1: sign up bonus, as long as you spend a certain

752
00:36:18,120 --> 00:36:21,880
Speaker 1: amount within you know, typically three months. So that's why

753
00:36:21,920 --> 00:36:24,600
Speaker 1: that's why I've got a solid seven hard inquiries, which

754
00:36:24,680 --> 00:36:26,440
Speaker 1: is it kind of surprised me when I saw it,

755
00:36:26,480 --> 00:36:27,879
Speaker 1: but every one of those I was like, oh, yeah,

756
00:36:27,960 --> 00:36:29,840
Speaker 1: that's me when yeah, the last one you signed up

757
00:36:29,840 --> 00:36:32,799
Speaker 1: for was an eight hundred dollar bonus. Yeah yeah, that

758
00:36:33,000 --> 00:36:35,440
Speaker 1: was a That was the business card which I was

759
00:36:35,520 --> 00:36:39,040
Speaker 1: able to open through my photography company. But I mean

760
00:36:39,080 --> 00:36:42,400
Speaker 1: I used it for for photography expenses and and I

761
00:36:42,400 --> 00:36:46,120
Speaker 1: got I got that hundred dollars. Yes, Essentially, watch out

762
00:36:46,200 --> 00:36:48,160
Speaker 1: when you're applying for credit. Just make sure you're not

763
00:36:48,200 --> 00:36:51,560
Speaker 1: applying for credit all over the place. But one caveat

764
00:36:51,640 --> 00:36:54,239
Speaker 1: is that if you're applying for a mortgage or car loan,

765
00:36:54,920 --> 00:36:57,480
Speaker 1: usually if you're applying within a two week period for

766
00:36:57,800 --> 00:37:00,239
Speaker 1: mortgages and you're you know, essentially shopping with a few

767
00:37:00,239 --> 00:37:02,480
Speaker 1: different lenders, and same thing if you're buying a car,

768
00:37:02,560 --> 00:37:04,640
Speaker 1: you're shopping with a few different lenders, your credit union,

769
00:37:04,640 --> 00:37:07,920
Speaker 1: a bank, trying to get alone. If it's within that

770
00:37:07,960 --> 00:37:10,800
Speaker 1: two week period, they will count it as one hard inquiry.

771
00:37:11,040 --> 00:37:13,320
Speaker 1: So don't be worried about that. Make sure you're shopping

772
00:37:13,360 --> 00:37:16,160
Speaker 1: around for your mortgage or car loans. That's way, that's great. Yeah,

773
00:37:16,160 --> 00:37:18,560
Speaker 1: that's way more important than you know, feeling like you're, oh,

774
00:37:18,560 --> 00:37:20,919
Speaker 1: I'm gonna doing my credit Like who cares? Your credit

775
00:37:20,960 --> 00:37:23,960
Speaker 1: will recover. It's like constantly as long as you're as

776
00:37:24,000 --> 00:37:25,520
Speaker 1: long as you're paying, you know, paying it off, like

777
00:37:25,760 --> 00:37:28,880
Speaker 1: doing the big things, it will recover. And what's more important,

778
00:37:29,080 --> 00:37:31,480
Speaker 1: way more important, I think is is shopping around and

779
00:37:31,520 --> 00:37:34,279
Speaker 1: making sure you're getting a competitive rate, finding a lender

780
00:37:34,320 --> 00:37:37,000
Speaker 1: that's not gonna really hit you with a ton of

781
00:37:37,080 --> 00:37:41,479
Speaker 1: ridiculous closing costs. Yeah, so shop hard, shop around, but

782
00:37:41,480 --> 00:37:43,239
Speaker 1: but do it inside of two weeks so that you

783
00:37:43,239 --> 00:37:46,359
Speaker 1: can limit that exposure to your credit score. So those

784
00:37:46,400 --> 00:37:49,000
Speaker 1: are the essentially those are the five biggest things that

785
00:37:49,040 --> 00:37:52,279
Speaker 1: weigh into your credit score. Right, So I'll run down

786
00:37:52,360 --> 00:37:56,360
Speaker 1: real quick payment history, your credit utilization, your age of credit,

787
00:37:56,520 --> 00:37:59,919
Speaker 1: length of credit history, types of credit in your credit mix,

788
00:38:00,120 --> 00:38:03,200
Speaker 1: and hard inquiries for new credit, and we will essentially

789
00:38:03,200 --> 00:38:06,200
Speaker 1: put that pie chart in the show notes on our website. Yeah,

790
00:38:06,200 --> 00:38:07,799
Speaker 1: those are all good things to keep in mind. Yeah,

791
00:38:07,840 --> 00:38:10,280
Speaker 1: so you can check it out. It's really really helpful

792
00:38:10,360 --> 00:38:12,480
Speaker 1: just to kind of visualize it and think through it

793
00:38:12,560 --> 00:38:16,080
Speaker 1: when you're considering your credit score and how to make

794
00:38:16,080 --> 00:38:18,799
Speaker 1: it better. So we're talking about what makes up, you know,

795
00:38:18,840 --> 00:38:21,040
Speaker 1: your credit score, let's actually talk about how you can

796
00:38:21,080 --> 00:38:24,920
Speaker 1: find your your credit score. Sure. So, Yeah, there's a

797
00:38:24,960 --> 00:38:27,279
Speaker 1: couple of websites that I prefer to use and that

798
00:38:27,400 --> 00:38:30,520
Speaker 1: I think are really the best out there for keeping

799
00:38:30,560 --> 00:38:32,560
Speaker 1: track of your credit score, for tools that can kind

800
00:38:32,560 --> 00:38:34,560
Speaker 1: of help you kind of stay on top of it. Um,

801
00:38:34,800 --> 00:38:39,279
Speaker 1: my favorite is discovers tool Discover Who is a credit

802
00:38:39,320 --> 00:38:41,440
Speaker 1: card Company's my favorite? Yeah, it's how you're gonna say

803
00:38:41,440 --> 00:38:43,080
Speaker 1: one of the other one. It's awesome, Man, I just

804
00:38:43,120 --> 00:38:46,200
Speaker 1: love that one because it's really simple. It's called credit

805
00:38:46,280 --> 00:38:48,560
Speaker 1: scorecard dot com. You know a lot of the other

806
00:38:48,600 --> 00:38:50,400
Speaker 1: credit cards are doing it. Nouncing like a max and

807
00:38:50,680 --> 00:38:54,000
Speaker 1: uh capital one. Yeah, so essentially do now almost Yeah,

808
00:38:54,040 --> 00:38:56,080
Speaker 1: like I said ten years ago Washington Mutual, it was

809
00:38:56,120 --> 00:38:58,440
Speaker 1: like this like lone Ranger giving people their credit scores,

810
00:38:58,680 --> 00:39:01,240
Speaker 1: and now you can get your credit score from almost

811
00:39:01,320 --> 00:39:03,600
Speaker 1: any credit card that you have. Um, I just like,

812
00:39:03,680 --> 00:39:06,879
Speaker 1: you know, I'm really weird about how things look, and

813
00:39:07,719 --> 00:39:10,880
Speaker 1: the simplicity of things and and discovers website makes it

814
00:39:10,960 --> 00:39:13,600
Speaker 1: really easy to find out exactly what I want to know.

815
00:39:14,000 --> 00:39:15,720
Speaker 1: Like the line graph where it kind of like tracks

816
00:39:15,719 --> 00:39:17,759
Speaker 1: it across. I like that, and I just I just

817
00:39:17,800 --> 00:39:20,120
Speaker 1: like the simplicity of not being like marauded by pop

818
00:39:20,200 --> 00:39:22,560
Speaker 1: ups and stuff like that, and so just nice and clean.

819
00:39:22,920 --> 00:39:24,400
Speaker 1: You know what, I put in my information and I

820
00:39:24,440 --> 00:39:27,360
Speaker 1: see my credit score and I move on. There's a

821
00:39:27,400 --> 00:39:29,000
Speaker 1: lot of websites out there too that that will say

822
00:39:29,000 --> 00:39:31,120
Speaker 1: that they'll give you your credit score for free too,

823
00:39:31,280 --> 00:39:36,879
Speaker 1: that are legitimately free. Our credit Sesame and credit Carma. Yeah,

824
00:39:36,880 --> 00:39:38,880
Speaker 1: those are grave views of those. I actually personally I

825
00:39:38,880 --> 00:39:41,520
Speaker 1: have not used that as they're both fantastic sites and

826
00:39:41,560 --> 00:39:44,719
Speaker 1: they're free, and essentially they work kind of like Mint does.

827
00:39:44,960 --> 00:39:47,640
Speaker 1: If you use Mint as a budgeting or tracking tool.

828
00:39:47,680 --> 00:39:50,839
Speaker 1: For your money. Uh, and there, you know, occasionally trying

829
00:39:50,840 --> 00:39:53,120
Speaker 1: to sell you a credit card or trying to um

830
00:39:53,160 --> 00:39:57,319
Speaker 1: get you to refinance your loan into something with you know,

831
00:39:57,360 --> 00:40:00,440
Speaker 1: one of their advertisers. But they will give you access

832
00:40:00,480 --> 00:40:03,760
Speaker 1: to your credit score from two of the bureaus, and

833
00:40:04,200 --> 00:40:06,200
Speaker 1: they give you a really good idea of the categories

834
00:40:06,200 --> 00:40:07,719
Speaker 1: in what you're doing well and when it comes to

835
00:40:07,719 --> 00:40:10,759
Speaker 1: credit and the categories what you're doing poorly. So they'll

836
00:40:10,800 --> 00:40:12,680
Speaker 1: they might tell you, for instance, hey, you know what

837
00:40:12,960 --> 00:40:16,560
Speaker 1: credit card utilization, you're kind of a yellow on this

838
00:40:16,640 --> 00:40:19,520
Speaker 1: like green yellow, red scale, and when it comes to

839
00:40:19,560 --> 00:40:22,000
Speaker 1: hard inquiries, you're red right now. So they kind of

840
00:40:22,000 --> 00:40:24,160
Speaker 1: help you understand. They break it down to to how

841
00:40:24,160 --> 00:40:26,720
Speaker 1: it's weighted, which is really nice. Yeah. So these weights

842
00:40:26,719 --> 00:40:28,520
Speaker 1: that we just told you about, you know, they're actually

843
00:40:28,600 --> 00:40:31,600
Speaker 1: kind of telling you here's exactly where you fall under

844
00:40:31,640 --> 00:40:34,959
Speaker 1: those weights and kind of how you can attack fixing them. Yeah.

845
00:40:35,120 --> 00:40:37,479
Speaker 1: So in the show notes, we'll we'll put some links

846
00:40:37,520 --> 00:40:39,160
Speaker 1: on there as well. It's some of the websites, there's

847
00:40:39,239 --> 00:40:40,960
Speaker 1: a lot of and I say that earlier to a

848
00:40:40,960 --> 00:40:43,200
Speaker 1: lot of the websites, they'll give you like a free

849
00:40:43,200 --> 00:40:45,480
Speaker 1: trial and if you don't cancel it, you'll start getting charged.

850
00:40:45,480 --> 00:40:47,560
Speaker 1: And so we'll put the links on there for some

851
00:40:47,640 --> 00:40:49,600
Speaker 1: of the actual free websites where you can get your

852
00:40:49,600 --> 00:40:52,200
Speaker 1: credit score and keep up with it. Yeah. So now

853
00:40:52,280 --> 00:40:55,760
Speaker 1: let's get to a question that a listener posted, uh

854
00:40:55,800 --> 00:40:57,799
Speaker 1: in our Facebook group. He wrote it all out and

855
00:40:57,880 --> 00:40:59,960
Speaker 1: I'm just gonna paraphrase it. Essentially that what he's saying

856
00:41:00,040 --> 00:41:02,160
Speaker 1: is that they had some long term, kind of long

857
00:41:02,160 --> 00:41:05,520
Speaker 1: standing credit card debt and he opened up two or

858
00:41:05,560 --> 00:41:08,880
Speaker 1: actually three new credit cards that had a zero percent

859
00:41:09,000 --> 00:41:12,879
Speaker 1: interest for like one or two years, and so they're

860
00:41:12,880 --> 00:41:16,640
Speaker 1: paying off their old credit card with those, and he

861
00:41:16,760 --> 00:41:21,879
Speaker 1: was wondering why his essentially their credit got dropped pretty significantly,

862
00:41:22,560 --> 00:41:25,319
Speaker 1: uh when when they did that. And this is where

863
00:41:25,320 --> 00:41:27,120
Speaker 1: he's confused. It is because he was thinking, well, we

864
00:41:27,239 --> 00:41:29,920
Speaker 1: increased the amount of credit that you know is offered

865
00:41:29,920 --> 00:41:32,920
Speaker 1: to us, so therefore our utilization rate hasn't changed. But

866
00:41:33,000 --> 00:41:36,440
Speaker 1: what he also said was that those new cards, he

867
00:41:36,560 --> 00:41:41,600
Speaker 1: maxed them out, and I think that's where the problem was. Yeah, so, uh,

868
00:41:41,840 --> 00:41:44,520
Speaker 1: something we didn't necessarily tackle earlier on when we talked

869
00:41:44,560 --> 00:41:48,080
Speaker 1: about credit utilization. There's always been this debate about whether

870
00:41:48,200 --> 00:41:51,680
Speaker 1: it is overall utilization. So let's say you have five

871
00:41:51,800 --> 00:41:57,080
Speaker 1: credit cards. Is it of your overall credit cards or

872
00:41:57,160 --> 00:42:00,719
Speaker 1: is it ten percent of each credit card. So let's

873
00:42:00,719 --> 00:42:03,800
Speaker 1: say you've got five thousand dollars on a five thousand

874
00:42:03,800 --> 00:42:06,640
Speaker 1: dollar card and nothing on the rest. Well, that five

875
00:42:06,680 --> 00:42:09,560
Speaker 1: thousand dollars that you have out against that five thousand

876
00:42:09,560 --> 00:42:11,920
Speaker 1: dollar card is actually gonna digging your credit in a

877
00:42:11,920 --> 00:42:14,680
Speaker 1: pretty big way. It's going to negatively affect your utilization.

878
00:42:14,960 --> 00:42:16,600
Speaker 1: It would be so much better if you had one

879
00:42:16,600 --> 00:42:20,520
Speaker 1: thousand dollars out against all five credit cards, so five

880
00:42:20,520 --> 00:42:24,799
Speaker 1: thousand dollars spread out evenly against all the cards. Yeah, yeah,

881
00:42:24,800 --> 00:42:27,160
Speaker 1: And again, this is something that's kind of it's it's

882
00:42:27,200 --> 00:42:29,400
Speaker 1: it's just kind of fuzzy, right, Like it's something that's

883
00:42:29,440 --> 00:42:31,600
Speaker 1: kind of constantly changing. I don't think this used to

884
00:42:31,680 --> 00:42:33,359
Speaker 1: be the case, but a lot of the experts now

885
00:42:33,400 --> 00:42:36,400
Speaker 1: are saying that it's not sort of this aggregate amount

886
00:42:36,400 --> 00:42:38,160
Speaker 1: of credit that you're offered and you need to stay

887
00:42:38,719 --> 00:42:42,279
Speaker 1: overall underneath and even you know, ten percent is even better.

888
00:42:42,600 --> 00:42:45,560
Speaker 1: It seems now that what experts are saying is that

889
00:42:45,920 --> 00:42:48,520
Speaker 1: we're looking at per card and so trying not to

890
00:42:48,560 --> 00:42:50,880
Speaker 1: exceed ten percent but definitely, you know, no more than

891
00:42:50,920 --> 00:42:54,560
Speaker 1: thirty per card. So if your maxim ount a card,

892
00:42:55,360 --> 00:42:59,279
Speaker 1: even though your total credit utilization hasn't changed, that's gonna

893
00:42:59,360 --> 00:43:01,840
Speaker 1: hurt your score. Yeah, and I will say I actually

894
00:43:01,960 --> 00:43:04,960
Speaker 1: kind of experienced this recently. I, um had to buy

895
00:43:05,000 --> 00:43:07,319
Speaker 1: some things for work and get them reimbursed and so

896
00:43:07,640 --> 00:43:11,000
Speaker 1: on this card that I have a limit on. I

897
00:43:11,080 --> 00:43:13,759
Speaker 1: normally charge you know, probably like two thousand dollars a

898
00:43:13,840 --> 00:43:16,920
Speaker 1: month and a yes, so right at ten percent and

899
00:43:16,960 --> 00:43:19,800
Speaker 1: then uh, but I actually had to up it to

900
00:43:20,000 --> 00:43:22,960
Speaker 1: like almost I think probably just over six grand in

901
00:43:22,960 --> 00:43:25,560
Speaker 1: a recent month, and my credit score dropped probably like

902
00:43:25,600 --> 00:43:27,840
Speaker 1: ten to thirteen points something like that. And so I

903
00:43:27,880 --> 00:43:30,239
Speaker 1: kind of saw that firsthand. It wasn't even like massive, right,

904
00:43:30,280 --> 00:43:33,040
Speaker 1: I wasn't using you know, nineteen thousand dollars out of

905
00:43:33,040 --> 00:43:35,320
Speaker 1: the twenty, but even just bumping it up, the credit

906
00:43:35,360 --> 00:43:37,239
Speaker 1: score just adjusted a little bit just based on that,

907
00:43:37,280 --> 00:43:40,280
Speaker 1: and I was kind of surprised. Um. So, yeah, those

908
00:43:40,360 --> 00:43:45,000
Speaker 1: individual credit cards and your credit utilization on each card matters,

909
00:43:45,320 --> 00:43:47,360
Speaker 1: and you need to pay attention to that. Yeah, and

910
00:43:47,719 --> 00:43:49,960
Speaker 1: we also touched on this earlier too, But every time

911
00:43:50,040 --> 00:43:53,279
Speaker 1: you have a new inquiry for new credit basically, so

912
00:43:53,320 --> 00:43:55,120
Speaker 1: when you every time you apply for a new credit card,

913
00:43:55,560 --> 00:43:57,920
Speaker 1: that's a hard inquiry, and that again makes up ten

914
00:43:57,960 --> 00:44:00,319
Speaker 1: percent of your total credit score. So every time you

915
00:44:00,360 --> 00:44:02,720
Speaker 1: opened up one of those, your credit your credit score dropped.

916
00:44:02,719 --> 00:44:05,560
Speaker 1: And that's something and with those being hard inquiries, that's

917
00:44:05,560 --> 00:44:08,080
Speaker 1: something that's gonna take, I mean a while for that

918
00:44:08,120 --> 00:44:10,400
Speaker 1: to rebound. I mean probably talking six months to a

919
00:44:10,480 --> 00:44:13,480
Speaker 1: year of you know, paying again early or on time

920
00:44:14,040 --> 00:44:15,880
Speaker 1: before you're gonna kind of see that creep back up

921
00:44:15,880 --> 00:44:19,000
Speaker 1: to where you were before. Yeah. Unfortunately, the hard inquiries

922
00:44:19,080 --> 00:44:22,160
Speaker 1: are only ten percent in your credit mix, and they

923
00:44:22,160 --> 00:44:24,279
Speaker 1: only have the most lasting impact for the first six

924
00:44:24,280 --> 00:44:27,400
Speaker 1: months to a year, and so um, that won't last forever.

925
00:44:27,640 --> 00:44:30,880
Speaker 1: And if you can essentially kind of start to spread

926
00:44:30,920 --> 00:44:33,040
Speaker 1: that money out on your of your credit card debt

927
00:44:33,080 --> 00:44:36,839
Speaker 1: between other cards as opposed to maxing out two of them, um,

928
00:44:36,880 --> 00:44:40,320
Speaker 1: that will really dramatically impact the health of your credit score.

929
00:44:40,360 --> 00:44:43,440
Speaker 1: So consider those two things and read. Thanks for the question,

930
00:44:44,280 --> 00:44:46,839
Speaker 1: all right, Matt. Back to the beer dog fish Head

931
00:44:46,960 --> 00:44:51,239
Speaker 1: oak aged Vanilla worldwide stout. I am loving this man.

932
00:44:51,239 --> 00:44:56,560
Speaker 1: This is completely in my wheel house, loving it. Clearly,

933
00:44:56,680 --> 00:45:01,640
Speaker 1: Jill's feeling that seventeen and a half percent. So the

934
00:45:01,680 --> 00:45:04,520
Speaker 1: reason I like it is that it's a big beer.

935
00:45:04,560 --> 00:45:06,800
Speaker 1: It's seventeen and a half percent, But it doesn't drink

936
00:45:06,880 --> 00:45:10,480
Speaker 1: heavy and thick. As I'm drinking it, it feels pretty

937
00:45:10,560 --> 00:45:13,480
Speaker 1: light and delicious. It's definitely sweet and kind of has

938
00:45:13,520 --> 00:45:17,400
Speaker 1: like that caramel e like molasses. Uh for sure. It

939
00:45:17,480 --> 00:45:20,920
Speaker 1: just tastes really roasted dark molasses, just all the good

940
00:45:20,920 --> 00:45:23,919
Speaker 1: things that I like. But it doesn't it doesn't sit heavy.

941
00:45:23,960 --> 00:45:26,000
Speaker 1: I'm not feeling you know, I'll full up with it.

942
00:45:26,120 --> 00:45:31,600
Speaker 1: So Yeah, sometimes I avoid vanilla beers because vanilla can

943
00:45:31,640 --> 00:45:34,880
Speaker 1: be just such like an overwhelming component. Totally chill on this.

944
00:45:35,160 --> 00:45:37,840
Speaker 1: It's perfectly chill. Love it. It's got like just the

945
00:45:37,960 --> 00:45:41,600
Speaker 1: nice vanilla notes. And I'll say too, I really like

946
00:45:41,680 --> 00:45:44,799
Speaker 1: the balance of how sweet it is, Like it's it's

947
00:45:44,880 --> 00:45:48,560
Speaker 1: somewhat sweet with like a nice boozy nous. So like

948
00:45:48,600 --> 00:45:51,480
Speaker 1: what you said at the very beginning of the podcast

949
00:45:51,680 --> 00:45:54,200
Speaker 1: was that it kind of warms you up inside, and

950
00:45:54,360 --> 00:45:56,960
Speaker 1: it's totally doing that right. It's got that boozy nous

951
00:45:57,040 --> 00:46:01,759
Speaker 1: quality that like warms your inerts. It's pretty awesome. Yeah,

952
00:46:01,760 --> 00:46:05,240
Speaker 1: even though it's March, I'll still call this a winter warmer,

953
00:46:05,440 --> 00:46:07,480
Speaker 1: and uh enjoy it. This is like the perfect beer

954
00:46:07,520 --> 00:46:10,359
Speaker 1: for tonight. Man. It's thirty degrees outside right now, and

955
00:46:10,840 --> 00:46:12,959
Speaker 1: I'm happy to be drinking this, no doubt. So thanks

956
00:46:12,960 --> 00:46:15,640
Speaker 1: again to Ryan for the beer, and thanks buddy to

957
00:46:15,920 --> 00:46:19,160
Speaker 1: dog fish Head for taking all the time to make

958
00:46:19,400 --> 00:46:21,480
Speaker 1: a beer this awesome. Yeah, dog fish Head, man, they've

959
00:46:21,520 --> 00:46:23,719
Speaker 1: been around forever. They have. Yeah, they're one of like

960
00:46:23,760 --> 00:46:26,239
Speaker 1: the old school craft craft beer guys, not like Sam

961
00:46:26,280 --> 00:46:28,560
Speaker 1: Adams old school, but like, you know, a couple of

962
00:46:28,600 --> 00:46:32,080
Speaker 1: years after after Sam Adams, dog fish has been around.

963
00:46:32,360 --> 00:46:34,040
Speaker 1: They're like one of the one of the first names

964
00:46:34,080 --> 00:46:35,920
Speaker 1: I feel like I remember seeing out there. They're one

965
00:46:35,920 --> 00:46:40,399
Speaker 1: of my favorite of the nationwide American craft breweries because

966
00:46:40,400 --> 00:46:43,279
Speaker 1: his hand like, they make some awesome beers. And I

967
00:46:43,280 --> 00:46:45,239
Speaker 1: could nerd out right now and go off for like

968
00:46:45,280 --> 00:46:47,279
Speaker 1: ten minutes telling you all the beers I love from

969
00:46:47,280 --> 00:46:49,680
Speaker 1: a dog fish Head. But we're not gonna. We gotta

970
00:46:49,719 --> 00:46:53,040
Speaker 1: wrap up, all right. So essentially the takeaways you need

971
00:46:53,080 --> 00:46:56,560
Speaker 1: to know on how to improve your credit score are First,

972
00:46:56,600 --> 00:46:58,440
Speaker 1: you need to know what a credit score is, and

973
00:46:58,560 --> 00:47:02,160
Speaker 1: it's the tool that financial institutions use to decide whether

974
00:47:02,239 --> 00:47:04,000
Speaker 1: or not to lend you money. More and more, it's

975
00:47:04,000 --> 00:47:06,400
Speaker 1: becoming important, So make sure you're kind of paying attention

976
00:47:06,440 --> 00:47:08,839
Speaker 1: to this. You hear it all the time. It's time

977
00:47:08,880 --> 00:47:11,279
Speaker 1: for you to to look yours up. Why you need

978
00:47:11,400 --> 00:47:15,120
Speaker 1: good credit. It influences the rates you're gonna pay on mortgages,

979
00:47:15,440 --> 00:47:19,000
Speaker 1: car loans, credit cards. It influences whether or not you'll

980
00:47:19,000 --> 00:47:22,279
Speaker 1: be able to rent a home, and possibly whether you'll

981
00:47:22,320 --> 00:47:26,600
Speaker 1: be able to get a job. So the steps you

982
00:47:26,640 --> 00:47:30,520
Speaker 1: can take to improve your credit score, there's five main factors,

983
00:47:30,960 --> 00:47:33,880
Speaker 1: five things that kind of way into your credit score.

984
00:47:33,920 --> 00:47:37,480
Speaker 1: The first and largest one being your payment history. Make

985
00:47:37,520 --> 00:47:40,920
Speaker 1: sure you're paying on time or early. Uh. That's going

986
00:47:40,960 --> 00:47:44,719
Speaker 1: to have the biggest impact on the makeup of your

987
00:47:44,719 --> 00:47:48,600
Speaker 1: credit score. Your credit utilization. It makes up thirty percent

988
00:47:48,600 --> 00:47:51,759
Speaker 1: of your score. And make sure that each card you're

989
00:47:51,840 --> 00:47:55,920
Speaker 1: charging less than thirty percent of the overall available credit

990
00:47:56,360 --> 00:47:58,840
Speaker 1: every month. And you know what, if you can do

991
00:47:58,920 --> 00:48:01,399
Speaker 1: even better than that, it's gonna help your score even more.

992
00:48:01,920 --> 00:48:04,080
Speaker 1: The next thing is the length of your credit history,

993
00:48:04,520 --> 00:48:06,640
Speaker 1: especially if you're younger, you're in college and you don't

994
00:48:06,640 --> 00:48:08,439
Speaker 1: have a credit card, Go ahead and do that now,

995
00:48:08,600 --> 00:48:10,520
Speaker 1: know yourself so that you're not going to get yourself

996
00:48:10,520 --> 00:48:12,600
Speaker 1: into a bunch of credit card debt, But go ahead

997
00:48:12,680 --> 00:48:15,520
Speaker 1: and get that card. Like Joel said earlier, maybe just

998
00:48:15,520 --> 00:48:17,239
Speaker 1: start putting your gas on there so you don't have

999
00:48:17,280 --> 00:48:19,000
Speaker 1: to walk inside of the gas station. Just make that

1000
00:48:19,040 --> 00:48:21,319
Speaker 1: happen in the pump and pay it off every month.

1001
00:48:21,360 --> 00:48:25,359
Speaker 1: Start building up that financial rep reputation, and that's gonna

1002
00:48:25,440 --> 00:48:27,200
Speaker 1: you're gonna thank yourself down the red. And if you're

1003
00:48:27,200 --> 00:48:29,680
Speaker 1: seventy years old, do not close your credit card you

1004
00:48:29,680 --> 00:48:32,000
Speaker 1: open up when you were twenty, because that's helping you. Right.

1005
00:48:32,160 --> 00:48:35,040
Speaker 1: So also, the types of credit that you're using makes

1006
00:48:35,120 --> 00:48:37,200
Speaker 1: up ten percent of your credit score. Make sure you

1007
00:48:37,239 --> 00:48:40,040
Speaker 1: have a wide variety of different credit available to you.

1008
00:48:40,320 --> 00:48:43,400
Speaker 1: Make sure to use it wisely, but have that variety available.

1009
00:48:43,760 --> 00:48:46,759
Speaker 1: And then lastly, again this is one of the smaller ones.

1010
00:48:46,800 --> 00:48:49,040
Speaker 1: So the one Joel just mentioned was ten percent. Uh,

1011
00:48:49,080 --> 00:48:51,680
Speaker 1: this one is also only ten percent. But hard inquiries

1012
00:48:51,719 --> 00:48:54,560
Speaker 1: for new credit every time you apply for say a

1013
00:48:54,640 --> 00:48:57,680
Speaker 1: new credit card or start shopping for a loan, those

1014
00:48:57,719 --> 00:48:59,480
Speaker 1: are gonna come in at hard inquiries and those are

1015
00:48:59,480 --> 00:49:02,479
Speaker 1: gonna doing your credit a little more. The beautiful thing. Also,

1016
00:49:02,520 --> 00:49:05,400
Speaker 1: there are great tools on the web for you to

1017
00:49:05,600 --> 00:49:08,440
Speaker 1: use to help you understand your credit better and to

1018
00:49:08,560 --> 00:49:12,200
Speaker 1: know your credit score in mere seconds. So we recommend

1019
00:49:12,680 --> 00:49:16,360
Speaker 1: credit scorecard dot Com, a tool from Discover credit Sesame,

1020
00:49:16,440 --> 00:49:20,200
Speaker 1: and credit Karma. Those are three great websites that won't

1021
00:49:20,280 --> 00:49:22,960
Speaker 1: charge you a dollar which will help you understand and

1022
00:49:22,960 --> 00:49:25,680
Speaker 1: know your credit score. We haven't actually talked about our

1023
00:49:25,719 --> 00:49:29,080
Speaker 1: credit scores. Let's dive old you wanna like share? Are

1024
00:49:29,120 --> 00:49:31,239
Speaker 1: you prepared to to kind of dive into that? Do

1025
00:49:31,239 --> 00:49:32,760
Speaker 1: you know yours off the top of your head, because

1026
00:49:33,000 --> 00:49:34,840
Speaker 1: you probably do. Actually had to look mine up. I

1027
00:49:34,840 --> 00:49:37,160
Speaker 1: had to look mine up. Well, I looked mine up today.

1028
00:49:37,200 --> 00:49:40,359
Speaker 1: I'm not so religious about my credit score that I

1029
00:49:40,400 --> 00:49:42,320
Speaker 1: could probably tell you on a day by day basis,

1030
00:49:42,600 --> 00:49:44,319
Speaker 1: but I do tend to look at it, you know,

1031
00:49:44,400 --> 00:49:47,000
Speaker 1: once every two months, and I looked it up today

1032
00:49:47,040 --> 00:49:50,319
Speaker 1: in preparation for this podcast on credit scorecard dot Com.

1033
00:49:50,400 --> 00:49:52,880
Speaker 1: And I will tell you after you reveal yours to me.

1034
00:49:54,680 --> 00:49:58,040
Speaker 1: All right, So even with my seven hard inquiries, so

1035
00:49:58,200 --> 00:50:00,640
Speaker 1: don't be like me, don't apply for seven new credit

1036
00:50:00,640 --> 00:50:02,920
Speaker 1: cards in the previous twelve months. But I was. I

1037
00:50:03,280 --> 00:50:05,640
Speaker 1: got above eight hundred, man, I was that like like

1038
00:50:05,719 --> 00:50:08,399
Speaker 1: eight o four eight five, I think nicely. It wasn't

1039
00:50:08,400 --> 00:50:09,840
Speaker 1: like right at eight there was like a little a

1040
00:50:09,840 --> 00:50:12,120
Speaker 1: little bit up there what you got. We'll keep working

1041
00:50:12,120 --> 00:50:16,000
Speaker 1: hard and maybe at some point punk you can to

1042
00:50:16,120 --> 00:50:20,319
Speaker 1: the amazing level of eight oh nine like me. So yeah,

1043
00:50:20,320 --> 00:50:22,920
Speaker 1: like five points sire than me. Yeah, I'm gonna hold

1044
00:50:22,920 --> 00:50:24,839
Speaker 1: that over you for a long time. I'm gonna hold

1045
00:50:24,840 --> 00:50:26,640
Speaker 1: it over your head. Here's the thing that, as much

1046
00:50:26,640 --> 00:50:28,759
Speaker 1: as we kind of like to joke about that, it's

1047
00:50:28,800 --> 00:50:30,600
Speaker 1: not the end. I'll be all. Uh. Some of the

1048
00:50:30,600 --> 00:50:33,120
Speaker 1: best credit cards out there that are offerings for me

1049
00:50:33,320 --> 00:50:35,560
Speaker 1: that I like to go after, which are the sweet

1050
00:50:35,560 --> 00:50:38,480
Speaker 1: sign up bonuses. They are looking for people that have

1051
00:50:38,760 --> 00:50:42,080
Speaker 1: high credit score, and typically that range starts at seven hundred.

1052
00:50:42,120 --> 00:50:43,759
Speaker 1: And that's what's so crazy is that you can get

1053
00:50:43,800 --> 00:50:47,200
Speaker 1: an amazing card with a sweet sweet sign up bonus

1054
00:50:47,600 --> 00:50:51,759
Speaker 1: easily five bucks. If you're you know, around seven and up,

1055
00:50:52,239 --> 00:50:55,480
Speaker 1: you're golden and real quickly. Three credit score numbers you

1056
00:50:55,480 --> 00:50:58,560
Speaker 1: should keep in mind because they are kind of essentially barriers,

1057
00:50:58,840 --> 00:51:02,960
Speaker 1: uh in good good markers for you. Six eighty, seven

1058
00:51:03,040 --> 00:51:06,200
Speaker 1: forty and seven seventy, so six eighty kind of like

1059
00:51:06,239 --> 00:51:08,480
Speaker 1: transitions you into like you know, what, this person is

1060
00:51:08,480 --> 00:51:10,919
Speaker 1: pretty trustworthy and go with their credit once you're above

1061
00:51:10,960 --> 00:51:14,600
Speaker 1: that number. Seven forty is like, man, this person's killing

1062
00:51:14,640 --> 00:51:18,400
Speaker 1: it and they have access to any sort of credit

1063
00:51:18,440 --> 00:51:21,080
Speaker 1: whenever they want. Seven seventy is like, you have access

1064
00:51:21,120 --> 00:51:23,440
Speaker 1: to any sort of credit, but also at the most

1065
00:51:24,400 --> 00:51:26,960
Speaker 1: preferred rates. So I've been in the seven sixties at

1066
00:51:27,000 --> 00:51:29,799
Speaker 1: sometimes and it's great, but you kind of miss out

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00:51:29,800 --> 00:51:31,640
Speaker 1: on some of the slightly better rates if you're going

1068
00:51:31,680 --> 00:51:34,319
Speaker 1: for a whole equity line or a mortgage rate. Thanks

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00:51:34,320 --> 00:51:36,360
Speaker 1: so much for listening to everyone. We really appreciate it.

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00:51:36,400 --> 00:51:39,120
Speaker 1: You guys are the best and the ladies. Be sure

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00:51:39,120 --> 00:51:41,160
Speaker 1: to check out how to money dot com. We'll have

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00:51:41,160 --> 00:51:43,200
Speaker 1: show notices up there, including some of the sites we

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00:51:43,239 --> 00:51:45,480
Speaker 1: talked about in this episode. And if you like what

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00:51:45,560 --> 00:51:49,120
Speaker 1: you hear, let us know and please review and subscribe

1075
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Speaker 1: on Apple Podcasts or wherever you listen to podcasts, because

1076
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Speaker 1: it really helps us spread the love with other people.

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00:51:55,239 --> 00:51:58,640
Speaker 1: It's kind of the currency online for podcasts, so it's true.

1078
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Speaker 1: If you'll like, just tell us a five star, four star,

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Speaker 1: one star. If you hate us up real quick and

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Speaker 1: let people know, don't give us a one star. Don't

1081
00:52:06,040 --> 00:52:09,759
Speaker 1: do it. Please, you hurt our feelings, but seriously, thanks

1082
00:52:09,760 --> 00:52:12,160
Speaker 1: for listening. We appreciate it and we'll be back next week.

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Speaker 1: Best friends out, Best friends Out,