April 13th, 2012
Credit Q&A with Justine, Credit Advisor
13 Comments |
We asked our Facebook community to share their biggest credit questions. Justine, Credit Karma’s resident Credit Advisor, chose two questions to answer today.
“Is there any way to make your identity more secure online against fraud?” (Keenan S.)
Here are three no-cost steps to protect your identity. 1) Enable your free credit monitoring with CreditKarma.com, which you can enable following these steps. We’ll alert you when significant changes occur on your credit file, such as new fraudulent accounts. 2) Sign up for BillGuard, a free online service that scans your credit card accounts for suspicious activity and red flags early warning signs of identity theft and fraud. 3) Take these steps to lock down your password and online information. And don’t share any personal and financial information, even your full name or address, to unsecure or unfamiliar websites.
“I have a car loan at 3.99% interest at about $2,100 and a credit card at 14.24% interest with about $6,000 on it. What is the smartest move to pay off the debt? And how would this help my credit score?” (Megan B.)
Focus on paying down your credit card debt as quickly as possible first. If you only make minimum monthly payments, it’ll take you 15 years and about $3,700 in interest to pay off. So increase your card’s monthly payments beyond the minimum, which will lower your credit utilization rate and improve your credit health. Meanwhile, keep making on-time monthly payments to your car loan, which will also help build credit. Once you pay your credit card debt in full, take the monthly payment and put it towards your car loan payment. Paying your car loan sooner than scheduled saves you money on interest!