September 11th, 2012
You Are Not Your Credit Score.
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**Welcome to Self-Improvement Month here on the Credit Karma Blog! Each week we’ll bring you content about how to improve you overall credit and financial health, as well as tips and personal stories from some great personal finance bloggers. Stick around!**
I talk about credit scores a lot here on the Credit Karma Blog. It’s only natural—the goal of offering all of you truly free credit scores is why Credit Karma was started in the first place. But even I have to remind myself to take a step back sometimes. After all…
You are not your credit score.
That number doesn’t…
Give you authority (or take it away).
Negate your actions.
Make you better than others.
Make you worse than others.
It just doesn’t. If you’ve believed any of those things, the moment that you stop, you’ll feel free. I truly believe that.
So stop for a second. Breathe. And remember: “I am not my credit score.”
Once you’ve got that down, read on to find out why (and when) your credit score is important.
When is your credit score important?
You don’t need to check your credit score every day, even though you can on Credit Karma. Likely, it won’t change from one day to the next, unless something new has been reported. So when should you check it?
To monitor for credit report changes. We started offering free daily credit monitoring so that you’d be notified if something important changes in your credit report. No need to pull your credit report monthly just to check for changes—we’ll email you if any of the following occurs: new credit inquiries, new credit accounts, delinquent payments, improved payment history (hooray!), new public records or updates to your personal information. Oh, and we’ll check every day for all of these changes.
To prepare for your next big purchase. Whether you’re buying a house or a car or hoping to get a loan to start your small business, you need to know your credit situation. I’m not just talking about your credit score, but your overall credit health. Use the Credit Report Card to get a quick run-down of where your credit is a-ok, and where you need to focus. If your on-time payment percentage is a little low, focus on getting that back up before you make that big purchase. It’s a huge influencer on your creditworthiness.
To check for credit report errors. It’s unfortunate, but true—credit bureaus makes mistakes just like the rest of us. Studies have found that anywhere from 3 to 25 percent of credit reports contain errors. Thanks to the government, you can get a free copy of your credit reports once every 12 months. But since errors can appear at any time, keep an eye on your Credit Karma account for things you don’t recognize. If you find one, here’s how to dispute credit report errors.
To help you improve your credit health. After going through a difficult situation like bankruptcy or foreclosure, it can be hard to get back on your feet. Maybe you’re not thinking about applying for a new mortgage any time soon, but you can start thinking about steps you can take to build your credit in preparation for the future. Check out this post on how to improve poor credit health.
Bottom Line: Unless you’re a credit nerd (like many of us here at Credit Karma), you might not need to fret so much over that three-digit number. Take care to monitor your credit in the instances mentioned above, but don’t forget that you are not your credit score.
Have a Karmic day!
Bethy Hardeman, Social Media Maven
Stay tuned for more Self-Improvement posts on the blog!
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