Sunday, October 29, 2006

The importance of having good credit


Having a good credit history is very important in maintaining a healthy and happy life. What most people dont realize is that employers, landlords and even insurance companies checks credit scores to make that final decision in whether or not they should give you that job or contract. Credit report and their scores helps companies determine whether you pay your payments on time or even if you have been sued or filed for bankruptcies. This way, they can use these information as a future indicator of your "credit worthiness", as it can reveal info about your past and present payment patterns.

Especially for me, everything that i want to do involves me having good credit. I can list the top 3 goals that i want to acheive in the next 5 years and how they relate to having good credit.


1.) After graduation, I will want to go apply for a job and they will most likely check my credit score to make some indication of how "responsible" i am. Most companies today have credit checks and having good credit might be that extra push that they need to make that decision on whether or not to hire me.


2.) The type of work that i want to do might require me to have a top level security clearance. Therefore having good credit is a must for this to goal.


3.) I want to buy a house maybe 2-3 years after i graduate, which will be in 2008 of may. It is critical that both my girlfriend and I have excellent credit scores for this one. Ofcourse having a good amount for down payment and our debt/income ration will be a huge factor, but having that good credit score will for sure be helpful when its that time for the credit bureau to decides how much they can trust to give me for a loan for that house.


These are some examples of how crucial it is for me to have good credit for me to do what i want to do. I want to emphasize the importance of good credit by saying that everything that i do now to prepare for my future is dependent of having good credit. The importance of credit today is so significant because it is one of the methods people are using to make any kinds of judgement on who you are based on your past payments. Although bad credit scores is not the most accurate way of identifying a persons behavior, it is still used as an assumption because that is all that they can go by.

3 comments:

FIRE Finance said...

This is so true. A good credit report opens the doors to success in every arena of our life these days. Keep up the good practices.

Anonymous said...

You forgot other areas that almost every large employer checks today:

1. Driving record (even if your job requires no driving).

2. Criminal activity - DUI's, possession, and all of the typical felonies.

3. Verification of earnings from previous jobs (if you were making X at your last job, then you aren't worth Y at the new job).

Now... in a few more years, there are a few other areas that will be checked:

1. Current health - resting heart rate, blood pressure, cholesterol levels, blood screening.

2. DNA screening - determine projected length of life, etc.

3. Personality screening - how likely are you to stay at the job?

4. Current bank account details.

Anonymous said...

Yup!
You are completely right. For the adult is really important to have a good credit score. To live a good life you need to have a family, children. But if you will not be available to have a normal credit it will be almost impossible to support a family, to grow up your children.
So make a right choice!