Before the holiday season creeps in, we have another ‘holiday’ to take part in. Referring to of course a favourite North American past time, that always falls on October 31st and is an exciting and fun time for both children and adults alike. One main aspect of Halloween that many individuals enjoy is the fright-factor associated with Hallowe’en.
Well, aside from these scary elements of Hallowe’en, there are other realities that scare us as adults and these of course can unfortunately include, issues of the financial kind. Just as vampires, zombies, and witches may prove scary, well bad credit and debt have also been known to frighten even the bravest of adults.
If you have been spooked by bad credit, here are 3 ways to get back on track.
1. Reviewing your Credit Report
First and foremost, even if you are already aware that you have bad credit, it never hurts to still take a look at your credit history. It is actually a very good idea to check your report as frequently as possible, for a variety of important reasons.
Not only can your credit report offer important insights into how you have been managing your credit – or mis-managing your credit in certain cases, it can also help you to turn around your credit for the better. By learning from the credit mistakes you have been making and those that have been contributing to a lower credit score, for example – the better equipped you are to improve upon these particular credit areas in the future.
Reviewing your credit report can also provide a glimpse into whether or not there are any errors or discrepancies in your report. If, for example, you notice that credit charges and actions have occurred and these have not in fact been performed by you – this could either indicate the possibility of identity theft or mistakes that have made by the credit reporting agencies or creditors themselves.
Either way, you want to be aware of any and all errors, discrepancies, as well as personal credit missteps you’ve made so that you can take the necessary steps to get back on track with your credit – and as soon as possible.
2. Start Paying Off More Debt
Another method of getting back on track and improving your credit is to reduce your debt. With a lot of debt, you are also just as likely to have bad credit. Therefore, it is best to look at where the bulk of your debt lies, as well as where you are being charged the most interest. These debt areas could be the major culprits behind why your bad credit continues to climb.
One such area that you may want to start paying down is your credit card debt. In order to boost your credit card payment plan, here you could consider taking out a consolidated loan in order to pay down all of your credit debt at once – and with a lower interest rate as well. Ultimately, having a credit card balance that is lower will allow you to have a better credit score as opposed to carrying around cards that are sitting very close to their limits.
In order to rid yourself of some of this debt, you can also look at other types of debt you are carrying, including larger loans such as a mortgage. A method of upping your game in terms of paying down more of your mortgage, you can inquire about adding another instalment payment to your mortgage repayment plan. Not only can this can help you pay down the debt at a faster rate, you can also shed some of your bad credit and move forward with less overall debt.
3. Reducing your Credit Card Use
Another approach to improving your bad debt also applies to your credit card usage. In this instance, in addition to paying off your credit card debt, you also want to follow this up by reducing your credit card use as much as you possibly can. If successful, these two steps together really will do wonders for helping you lower your debt and improve your credit.
Again, keeping your credit card balance at a reasonable level of under 30-50% of the total balance will be key to being able to improve your score. Even though you still need to pay for bills and make a variety of purchases on a regular basis – instead try to pay with cash and debit whenever possible.
To add to this strategy, and in order to also reduce your credit card usage, you can attempt to lower your overall spending and this in turn can greatly contribute to an improved credit situation for you.
As Hallowe’en is soon to pleasantly creep into our lives, don’t let bad credit continue to creep its way into your life. Instead, take steps to pay down your debts and reduce your credit card spending, also not forgetting to check in with your credit report – in the end, leaving all the spooking up to Hallowe’en and not your finances.