Generally, most of us tend to ignore our credit score.
But, we forget that our credit score is as important as our Social Security Number (SSN).
So, no matter what, you must keep a close watch on your credit score.
If you are neglecting your credit score for long, it’s time you should pay attention to it. If you have a poor credit score, take steps to increase it; because, a bad credit score will get you nowhere financially. But, with a good credit score, you’ll be able to overcome the most difficult financial situations.
Why your credit score is more important than your SSN?
A Social Security Number is a proof of your identity; whereas, a credit score shows your creditworthiness to your creditors or lenders.
A credit score is more vital than your SSN when you’re dealing with your finances.
Here I’ll tell you why it’s important to have a good credit score for your financial well-being.
1 Grab better loan rates
You must know that the economy functions on credit. Whether you want to take out a mortgage, car loan or student loan, a good credit score will help you to get the best rates on your loan. This is possible because creditors or lenders will see you as more creditworthy.
2 Save money on interest rates
A good credit score helps you save your precious dollars on interest rates while obtaining a loan. However, your credit score will be reviewed by insurance companies, landlords, and employers also. A high credit score will portray your responsible nature to them.
You might have to face difficulty in taking out a loan if you have a low credit score. It doesn’t mean you won’t qualify for a loan. But, usually, you’ll get the loan with higher interest rates.
3 Save dollars on insurance coverage
Who wants to risk his/her business by providing service to a person with devastating credit history? I hope no one would do that. Your credit score will be checked even if you want to get a life insurance coverage.
Most insurance companies use the credit-based insurance score (CBIS) to make you qualify for the coverage.
4 Get increased credit limits
Creditors will consider you as a responsible credit card holder and can automatically increase your credit card limit if you have a great credit score. Plus, you won’t have to negotiate hard for getting an increase in your credit card limit.
5 Get amazing credit card deals
Go on paying your credit card bills on time and continue enjoying these services.
6 Give you more negotiating power
Whether you apply for a loan or get an insurance coverage or increase your credit line, a high credit score will provide you more negotiating power. If you have a good credit score, use it to get low interest rates on your loan.
7 Pay no security deposit for basic utilities
Your utility, cell phone, and cable TV providers check your credit score before signing a contract with you.
However, with a good credit score, you don’t have to pay any security deposit for these services.
8 Help to identify a fraud
You can spot a fraudulent activity if you constantly keep a watch on your credit score. For instance, if you notice an unexpected drop in your credit score, it means your credit information has been stolen. If this happens, you must immediately report this scam to the credit reporting agencies and get it removed from your credit report.
Thoroughly monitor all your free credit reports annually from the 3 credit bureaus.
Therefore, never share your SSN with anyone and remember it by heart instead of photocopying and storing it in your wallet.