Be Credit Wise with Holiday Shopping

sale, shopping, tourism and happy people concept - two beautiful women with shopping bags in the ctiy

Bargains abound on Black Friday, Cyber Monday and throughout the holiday season. Who doesn’t love a good bargain? But there are credit traps lurking behind those bargains. Beware of these credit traps that can put a damper on on the holidays . . . and even your credit score in 2017.

  1. Overspending

There is no denying it. Consumers spend more when paying with a credit card instead of cash or a debit card. Is that really a surprise? Credit cards are just so convenient. Avoid overspending by showbox app setting a budget ahead of time and, ideally, paying with cash to ensure you stick to your budget. When January rolls around, you’ll be glad you did.

  1. Maxing Out Credit Card Accounts

Can’t resist the convenience of plastic or don’t want to miss out on credit card rewards? As you charge away, keep in mind your credit score will take into consideration the percentage of your credit card limits that are in use. Try to keep the balances below 30%. If you exceed that, pay down the balance before your statement closing date so that a lower balance gets reported to the credit bureaus.

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  1. Identity Theft

Identity theft will be alive and well throughout the holiday season. Stay alert. Be aware of your surroundings. Don’t sacrifice convenience for security. Also realize that many bogus charities come to life this time of year. Do your homework and research charities before donating and especially before handing over your personal information.

  1. Opening New Credit Card Accounts

It can be tempting to open a new credit card account when you are offered a discount on your purchases, but think twice. Do you need another credit card to think about? Your credit score could take a hit when prospective creditors check your credit report or credit score, too. If you weren’t already planning to open a new account, don’t be lured in with a special offer for holiday shopping.

  1. Emotional Spending

Don’t let emotions rule the day when holiday shopping. Stay focused on January. What is your situation going to look like then? Will you be struggling to pay bills because you overspent? Will your credit score take a hit because your spending was out of control?

Everyone loves a bargain. Keep these tips in mind to ensure your bargains don’t come back to haunt you—or your credit score—in 2017.

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5 Credit Report Red Flags

woman-dogYour credit report is a snapshot of how you have handled credit. It reports the balances on your credit cards and loans, and your bill paying history. (Don’t think even a single late payment will go unnoticed!) When you apply for new credit, lenders review your credit report to determine the terms of any credit they might extend to you. Once you have established credit, that lender will most likely review your credit report from time to time to see look for red flags. Here are 5 red flags that could scare a lender:

1.  Too Many Inquiries

When you apply for credit, potential lenders will usually pull your credit report to get a feel for your credit worthiness. This gets recorded as a hard inquiry on your credit report. Too many hard inquiries can be a red flag that you are in financial trouble. Although inquiries typically have minimal impact in most credit scoring models, it may be enough to drop you into a lower credit score bracket.

2.  Debt from Co-Signing a Loan

Many people fall into the trap of co-signing a loan to help a friend of family member without realizing that debt will show up on their own credit report too. As a co-signer, you are equally responsible for the debt. Any late or missed payments will be red flags to your own lenders. And even when the loan is being repaid under good terms, that debt is added to your existing debt load when you apply credit of your own.

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3. Short Sale

A short sale gets reported to the credit bureaus as “settled.” That’s a red flag that says you did not pay the lender as agreed, and it can be just as negative as a foreclosure on your credit report. There may be times when a short sale is the right option, but don’t believe anyone who says it won’t hurt your credit.

4.  Credit Report Errors

Your credit report could have red flags that are no fault of your own: errors. There’s really no way to safeguard your credit report from them. It’s important to check your credit report for accuracy. A credit monitoring service will alert you to significant changes that should be verified for accuracy.

5.  A Consumer Statement

You have the right to add a 100-word statement to your credit report explaining something you think might be viewed negatively. Think twice before doing this. Lenders expect to paid as agreed regardless of your circumstances. If, however, you have been a victim of identity theft, it might be beneficial to explain that in a consumer statement.

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5 Tips To Protect Teens from Identity Theft

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Why are children under the age of 18 almost twice as likely to become identity theft victims as their parents? Teens make easy identity theft targets because they usually have clean credit reports (or none at all). Couple that with the typical teen’s trusting nature, and the stage is set for identity theft. Here are 5 steps that can help protect teens from identity theft.

  1. Keep personal information private. Many teens are an open book with their friends. They may not think twice about sharing personal information. But all it takes is one less-than-honest or desperate friend to open the door for identity theft. Encourage your teen to protect his identity by not sharing personal information, even with friends.

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  1. Limit exposure on social media. Most teens are on at least one social media network such as Facebook or Twitter. And most of them are friends with people they hardly know or don’t know at all. Once something is posted, control of that information is forever lost. Identity thieves are keenly aware of this weakness and hang out on social media sites looking for weak links. Teach your teen to limit exposure on social media networks.
  1. Keep a slim wallet. Your teen should never carry more than is necessary in his wallet. Old-fashioned pick pocketing is still popular with identity thieves. Social Security numbers are especially valuable, and there is usually no reason for a teen to carry a Social Security card.
  1. Shred, shred, and shred some more. Help your teen get in the habit of shredding anything with personal information before getting rid of it. Unsolicited credit card offers contain a wealth of personal information that makes it easy for an identity thief to open credit in your teen’s name. Buy a shredder and use it to discard of anything with personal information.
  1. Monitor your teen’s credit report. Once your child starts using credit, teach him the importance of knowing what is on his credit report because that is the information used to calculate his credit score. Review it periodically to check for accuracy. That’s often where evidence of identity theft first shows up. A credit monitoring service is an easy and effective way to keep tabs on your teen’s credit report.

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Well, Well, Wells Fargo!

Surprised woman looking over her glasses. Beautiful jaw dropped girl with modern eyewear.Sometimes you just have to shake your head in disbelief. That’s how it felt when news broke that Wells Fargo employees had opened at least two million new accounts behind their customers’ backs. Over a half million of those were credit card accounts. Why? Most cite intense pressure to meet unrealistic sales goals. And it has been going on for years—at least as far back as 2011, but maybe as far  back as 2007.

The Impact on Credit Scores
A major concern to consumers should be how the Wells Fargo scandal may have impacted their credit scores. That’s a legitimate concern since it may be difficult, if not impossible, to know for sure because there are so many variables that can affect one’s credit score, and it can be different for each consumer depending on other factors on one’s credit report.

Paul Bland, executive director of the legal advocacy group Public Justice said, “Figuring out what people’s actual damages are is really, really difficult. It’s going to take a lot of work and energy to unravel this.”

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New accounts opened fraudulently by Wells Fargo employees would typically be reported to the credit bureaus and show up on your credit report as a hard inquiry. Inquiries are usually not one of the major factors affecting your credit score, but in some cases, a few points difference in your credit score it could be enough to impact the terms of a loan or whether you are approved at all.

Indeed, for some, another credit card could cause a credit score to go up because it raises the amount of available credit. This has the positive effect of lowering the percentage of available credit being used. But what happens when you choose to close the unwanted credit card account, as Wells Fargo is offering to do? It could have the opposite effect and lower your credit score because you will suddenly be using a greater percentage of available credit.

Be Proactive with Credit Monitoring
Many Wells Fargo customers were not aware of having a new Wells Fargo account until the scandal broke in the news. This reinforces the importance of keeping tabs on your credit report. It’s Wells Fargo in the spotlight today. Who will it be tomorrow? A credit monitoring service is the easiest way to keep tabs on your credit report on a daily basis. Subscribers are alerted when a new account is reported to the credit bureaus—not when it hits the news.

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Outsmart Identity Thieves with These 5 Tips

woman-coffee-shopIf you haven’t been an identity theft victim yourself, chances are good that you know someone who has been. Identity theft is rampant and shows no discrimination. It strikes the rich and famous with the same vengeance it strikes the butcher or baker. Identity thieves use both high-tech and low-tech tactics and usually attack the weakest link. Here are 5 tips for outsmarting identity theft.

1. Shred! Shred! Shred! Identity thieves still go through trash looking for personal information that can make it easier to steal an identity. Get a cross-cut shredder and use it diligently to destroy anything with personal information before it goes in the trash. That includes credit card statements, expired credit cards, pre-approved credit card applications—anything, really, with personal information.

2. Don’t let your guard down on social media. Realize that anything you post is never completely private—even if you delete it. Use common sense before sharing personal information with the world. Check your privacy settings. It’s amazing the identity footprint many people leave on social media sites—full date of birth, location, messages that indicate you are away from home (sometimes for a long time!).

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3. Never conduct personal business over WiFi. The risks of conducting personal business while you are at a coffee shop, the airport or any public place far outweigh the convenience. Don’t do it! Tech savvy identity thieves know how to snag your information, and snag it they will.

4. Keep tabs on your credit cards. Put time on your side by checking your accounts in between statements for unauthorized use. Know where your credit cards are at all times. If your credit card issuer offers the option of adding a photo to your credit card, do it!

5. Go paperless and use a locked mailbox for outgoing mail. Mail—both incoming and outgoing—often contains a wealth of personal information. In the wrong hands, that information can be used for identity theft. Go paperless to limit incoming mail. Deposit outgoing mail in a locked mailbox. The red flag that alerts a mail carrier that there is mail in your mailbox alerts identity thieves of the same thing.

No one can guarantee that you will not become an identity theft victim. It is impossible to control all of the places that have access to your personal information. But these tips can help you reduce your risk.

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Credit Monitoring for Baby Boomers

Senior couple on cycle ride in countryside

Baby Boomers are retiring at the astounding rate of 10,000 per day. That far exceeds the retirement rate of any previous generation. Baby Boomers are also far exceeding previous generations with the amount of debt they are strapped with as they enter retirement. Let’s take a look at Baby Boomers entering retirement today.

  • Nearly half of today’s retirees retire with debt.
  • About two thirds of those near retirement age expect to have a mortgage when they retire.
  • About 40% of those near retirement age expect to be paying on credit card debt during their retirement years.
  • Nearly 60% of Baby Boomers are providing financial support to their adult children. Many co-signed on student loans, auto loans or even mortgages, and are finding they are responsible for these debts.

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Keeping a Health Credit Score in Retirement

As far as credit scores, Baby Boomers have done okay as a group—not quite as well as the Greatest Generation, but significantly better than younger generations.

Hopefully Baby Boomers know that retirement is not the time to neglect your credit score! Your credit score will continue to drive the terms of any credit you may need—whether that is refinancing a mortgage at a lower interest rate, consolidating debt or paying for unexpected medical bills. Credit tips that are good for other ages continue to apply during retirement years:

  • Pay bills on time every time.
  • Keep credit card closing balances below 25% of their account limit—even if you pay them in full each month.
  • Maintain an accurate credit report. No one knows better than you if the information on your credit report is accurate.

Baby Boomers also need to be aware that seniors are often targeted for identity theft because they often have established a good credit history. It makes good sense to keep an eye on your credit report during your retirement years because that is often the first place where signs of identity theft show up. MyFreeScoreNow’s credit monitoring service checks your credit report daily for significant changes that should be verified by you including:

  • New credit accounts opened.
  • Change in credit accounts such as late payments
  • Address and employment changes
  • New inquires to your credit file
  • Public records such as liens and bankruptcies

Retirement should be a time to relax and enjoy life a little. Treat yourself to credit monitoring so there is one less thing to worry about.

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Credit Scores for the Graduate

Three young graduates pump their fists in the air outdoors and celebrate their achievement

If you are a 2016 graduate, you probably know your GPA. You may have seen it fluctuate during your school years, and there may have even been times when it was of concern to you. Was it too low to get you into a certain school? Was it going to limit scholarship opportunities? Could it affect you in ways you don’t even know?

With graduation behind you, thoughts of your GPA may be behind you also. But when you enter the post-graduate world, you have a new sort of GPA—your credit score. Like your GPA, it’s a number you should track and be aware of as it changes.

Information in your school transcript was used to calculate your GPA. The information in your credit report is used to calculate your credit score. Let’s take a look at both credit reports and credit scores.

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Credit Reports

Credit reports are maintained by credit bureaus (also known as credit reporting agencies). The three major national credit bureaus are Equifax, Experian and TransUnion. Credit bureaus are private, for-profit companies that collect information from creditors about how you pay your bills. They also gather information from public records, so things like bankruptcies and liens can show up on your credit report. Creditors are not obligated to report to the credit bureaus, but most are happy to do so because they also benefit from the information others provide.

Simply put, your credit report is a collection of information that tells the story of how you handle credit over time. It lists your accounts and how much credit is available to you, your outstanding balances and tracks whether or not you pay on time. Negative information can stay on your credit report for 7 to 10 years, though the impact of negative information should diminish over time.

Credit Scores

Your credit score is a three-digit number that sums up the information in your credit report. It provides lenders and others with a quick way to analyze your credit history and your predicted credit risk. As the information in your credit report changes, your credit score changes.

 
Why Credit Scores Matters

Credit scores give lenders a quick and unbiased way to make credit decisions. Your credit score can determine the credit terms you are offered including interest rate.

Don’t make the mistake of ignoring your credit score. It can affect your life long after you’ve forgotten your GPA.

 

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6 Tips To Protect Your Identity When You’re on Vacation

While you are on vacation relaxing and forgetting the cares of the world, identity thieves are hard at work watching for you to let your guard down. One study reported that 20 percent of consumers have had a document with personal information lost or stolen while they were traveling. Think driver’s license, passport, credit cards.

Keep your guard up while on vacation to minimize your risk of becoming an identity theft victim. Here are 6 tips to help safeguard your identity.

  1. Beware of WiFi hotspots. Your hotel or the coffee shop down the street may offer free WiFi, but the connection may not be secure. Be especially cautious about downloading software updates from a WiFi hotspot; these may secretly download malicious software to your computer. A Virtual Private Network (VPN) offers a safer way to do business by encrypting information that passes between your computer and a wireless network.
  1. Avoid public computers. The public computer in a hotel may be convenient for a checking out local restaurant ratings, but don’t conduct private business from it. It is impossible to know what software has been installed, and the risks far outweigh the convenience.

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  1. Use caution at ATMs. You may need cash while on vacation, and identity thieves know that. Their tactic? Install a skimmer to an ATM to capture account numbers and PINs. ATMs inside a bank branch tend to be more secure and are usually monitored by camera
  1. Travel with a light wallet. Old-fashioned pickpocketing is still used by identity thieves. Don’t carry unnecessary cards in your wallet that make a thief’s work easier. Leave your Social Security number at home.
  1. Wait until you return to share your vacation on social media. You may think you are sharing with trusted friends, but the truth is it is hard to know where your privacy stops and starts on social media sites. Wait until you are home to broadcast that your home was vacant.
  1. Monitor your accounts while you are away. If possible, use a secure connection to check your bank and credit card accounts while you are away. But if your only option is an unsecured Wifi, it is not worth the risk. This could be a perfect time to try a credit monitoring service that will alert you by email to any significant changes to your credit report.

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Protect Your Identity Footprint

Identity theft statistics are alarming! With many cases never being report, the real number of identity theft victims is probably much higher than the 12 to 15 million a year you often hear quoted. Is your identity footprint leaving you vulnerable to identity theft? Legs of woman on the beach in summer

Your identity footprint is anything someone could steal and use to create a piece of a new identity. It could be personal or financial. Really, it doesn’t take much for someone to make you the next identity theft victim.

Be conscious of your identity footprint to minimize your risk of becoming an identity theft victim. Don’t give identity theft criminals easy access to your identity! Instead of fretting about the things that are out of your control, concentrate on the things you can control.

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Shred, shred, shred. Shred anything with personal information. Identity thieves still scour dumpsters and trashcans for information that can help them create a new identity.

Lighten your load. The less you carry, the less an identity theft criminal will have access to if your wallet or purse is stolen. And yes, old-fashioned pickpocketing is still a common tactic thieves use.

Pay attention to your bills. Keep an eye on your credit card and bank accounts in between statements. A lot of damage can be done in thirty days. If your statements don’t arrive on time, call the bank or card issuer.

Guard your Social Security number.
Your Social Security number is like gold to identity theft criminals. Don’t carry your card. Leave the Social Security number field blank on forms you fill out until you know why it is needed.

Beware of phone and email scams. A little common sense can help you avoid becoming an identity theft victim through a phone or email scam. Unless you made the phone call and are sure of the number you are calling, don’t give personal information on the phone. Be careful about clicking on links in an email. Anyone can create a website that looks official . . . but isn’t.

Don’t conduct personal business in public. Guard your privacy with identity theft in the back of your mind. . You never know who is looking over your shoulder or capable of grabbing your information from an unprotected WiFi connection at a coffee shop. Never sacrifice privacy for convenience.


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5-Minute Guide to Credit Monitoring

Happy smiling woman pointing to somethingBack in the old days credit decisions were based on a relationship or a creditor’s feelings. Now, it’s your credit report. Creditors may look at your actual credit report or at the credit score calculated based on the information in your credit report. Either way, credit decisions are more black and white than they used to be. That makes an accurate credit report—one that is telling the right story—so important. A credit monitoring service can handle the challenging task of keeping tabs on that important financial document – your credit report.

Credit monitoring helps you maintain an accurate credit report.
The worst mistake on your credit report is the one you don’t know about. With credit monitoring you will know about important changes as they happen, putting you in a position to take swift action. Some of the activity a credit monitoring service looks for includes:

• New accounts opened
• New public records
• Changes to public records
• Changes to account information
• Inquiries to your credit file
• Address changes

Credit monitoring alerts you to signs of identity theft.
While credit monitoring cannot prevent identity theft (nor can anything else!), the kind of changes a credit monitoring service looks for on your credit report are the very things that could signal identity theft in progress. Credit monitoring puts time on your side when signs of identity theft show up on your credit report.

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Credit monitoring alerts you to who has viewed your report.
Creditors, employers, landlords and other business entities may have a legal and legitimate right to view your credit report. And you have a right to know when they do. Those looks, called inquiries, can have a negative impact on your credit and credit score. Credit monitoring alerts you whenever a hard inquiry that could impact your credit score is added to your credit report.

Credit monitoring is convenient.

Credit monitoring helps you keep a watchful eye on your credit. While ordering credit reports throughout the year is better than nothing, it offers limited protection because your credit report is a snapshot of your credit at a particular moment in time. A credit monitoring service is on call every day.
It frees you up to go about your life without neglecting your credit report.

Credit monitoring can save you money.
Sure, there’s a cost to credit monitoring. But when that is weighed against the benefit of having an accurate credit report, it could save you money. Even minor credit report errors can be enough to bump you into a higher interest rate tier that could affect your payments for years. An accurate credit report is important to ensure you aren’t paying for someone else’s mistake.


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