How do you know if your credit score is good or bad? Will it affect your ability to get a job? Can it impact your marriage? It’s time to find out, as monitoring your credit score can help you in several ways. Here are the 9 benefits of monitoring your credit score.
What are the 9 Benefits of Monitoring Your Credit Score?
1. Build a Better Financial Future
Studies have shown that keeping a handle on your credit score can help you build wealth faster than others. Knowing where you stand financially can also save you from some common money mistakes.
If you’re currently working with a lender or other financial professional, they’ll also likely use your credit score as part of their decision-making process.
The next time you make an important money move—like buying a house or getting a car loan—it’s worth checking your credit score to see if it’s a factor. It could be one less thing to worry about during what will already be an exciting and anxiety-producing time in your life.
2. Monitoring Your Credit Score Helps You Avoid Fees
Monitoring your credit score can help you avoid fees associated with loans, credit cards, and other financial products. For example, if your credit score is low, you may be charged a higher interest rate on a loan. Or, if you’re trying to rent an apartment, a landlord may require a higher security deposit if your fico score is low.
Monitoring your credit score is a good way to stay on top of your financial health. By keeping an eye on your credit score, you can avoid fees and save money in the long run.
3. Access Loans at Lower Interest Rates
Want to unlock the secret to snagging a loan with tantalizingly low interest rates? Keep a keen eye on your credit score! With stellar credit, you’ll be ushered into a world of premium loan terms. But tread lightly; a less-than-impressive score could have you shelling out considerably more for that same loan.
When you apply for a loan, lenders will look at your credit score. They’ll also look at other factors like how much money you make and what kind of debt obligations you already have. The better your score is and the more responsible you’ve been with your debts in the past, the more likely it is that the lender will approve your loan application.
4. Prevent Identity Theft
Identity theft is a problem that affects millions of people every year, with over 15 million victims in 2017 alone. That’s why it’s so important to learn how to protect yourself and what you can do if you think you’ve been a victim of identity theft.
Monitoring your credit score regularly can help you avoid becoming a victim of identity theft by letting you know when someone is trying to open accounts in your name.
You’ll be able to spot suspicious activity like new loans or credit card applications, which could be signs that someone is trying to gain access to your accounts and personal information.
5. Get Insurance
Insurance is a big deal, and it’s not just about getting the right coverage for your needs. It’s about having the peace of mind that comes with knowing you’re covered. If you have bad credit, though, it can be hard to find an insurance company that will take you on as a customer.
But if you monitor your credit score and keep it healthy and strong, you’ll be able to get the best possible insurance rates and coverage.
6. Keep Up Appearances
A low credit score doesn’t mean you can’t buy what you want, but it does make it more difficult to do so. If you plan on buying a house or a car, a low credit score could raise your interest rate or lower your approval for financing. It also puts a black mark on your record and could affect other areas of your life.
Even if you don’t plan on buying something big, monitoring your credit score has some positive effects: A positive outlook can influence how banks view you. Seeing that all of your accounts are in good standing could increase future offers from retailers. As you continue to see improvements on your credit score, you will be motivated to continue controlling debt in other areas of life as well.
7. Ensure That You Receive Government Assistance if Needed
The United States federal government provides assistance to Americans who are unable to afford their own medical care. This assistance can take the form of Medicare, Medicaid, and other programs. If you are eligible for this assistance, you should do everything possible to ensure that you receive it.
One way to ensure that you receive government assistance is to monitor your credit score and make sure it is up-to-date. This will help ensure that your eligibility for government assistance is not affected by any negative items on your report (such as late payments).
8. Give Yourself Peace of Mind
Monitoring your credit score can give you peace of mind, because you’ll be able to know in real-time if someone has stolen your identity and is using it to open accounts in your name. If that happens, you’ll know right away and can act quickly to protect yourself.
9. Improve Creditworthiness
Regularly monitoring your score helps track your progress and ensures errors are corrected timely. By doing this, any issues on your report can be resolved before hindering loan approvals. Consequently, this proactive approach significantly boosts your creditworthiness for future financial endeavors.
Bottom line
Credit monitoring is especially critical when you consider how easily consumer information can be accessed by criminals. By making sure that your credit report is protected, you can rest easier knowing that you are protected financially and won’t have to worry about any unauthorized charges.
Now that you know how beneficial monitoring your credit score is, you can check this free guide on simple but effective ways to improve your credit score.
