The Importance of Post-Retirement Credit Score And How To Maintain It
Retirement — a magic word which conjures up so many images in our minds. Images of relaxing, traveling around the world, and spending more time with the family are the ones that are most prominent. In some cases, there are several people around the world who take up a second career post-retirement. It is also the time when you can finally relax and enjoy your free time since your finances are all sorted, all your debts are probably cleared, and you don’t have to worry about your credit score anymore, right? Wrong. A credit score is crucial even when you have retired. So, why do you need it at a time when you are not working anymore? Here are the top reasons why you do:
To Avail Good Insurance Rates
Credit scores often determine the insurance premiums for your house and cars. When your credit score is high, it makes you look responsible. Hence, the premium might get lessened. When you have retired, you might have enough to live a good life, however, having what you think is enough money shouldn’t be an excuse to stop saving what you can. In fact, saving shouldn’t stop post-retirement. So, it is best to look around and find out which insurance company has the least premium. Your credit score will ensure that you get the best deal.
To Avoid Identity Theft
It is a common practice among retired people to stop monitoring their credit score as well as their credit history. People who don’t check their credit reports regularly are at greater risk of facing identity theft. It has been found that senior citizens and retired people are often targeted for identity thefts. It is, therefore, very critical to check your credit report every now and then to ensure that everything is as it should be.
To Refinance A Mortgage
Ideally, all your debts should be paid off by the time you have retired. But it has been found that almost 40% people retire with a mortgage. Since your financial conditions will change post-retirement, you might need to refinance your mortgage. A good credit score is a must in that case. When interest rates drop, you can easily refinance your mortgage if you have a good FICO score.
So, how can you rebuild your credit score once you have retired? Here are three ways that might help.
Get A Secured Credit Card
FICO says that in order to have a credit score, a person must have at least one credit account that is six months old. If you neither have any kind of loan nor paying any mortgage, then you must have at least a credit card. For those who do not have a credit card, apply for one, and make sure to get the one that is secured. Look around, and opt for the one that suits your needs. Some cards have a money/cash back offer, while others have discounts on selected restaurants and other food establishments. Choose the one that goes with your spending habit. Once you get the card, always pay off your bills on time. In a few months time, you will have a good credit score.
Use Your Credit Cards Frequently
Use your credit cards as often as you can to pay for your expenses. When paying credit card bills, make sure that you pay the full amount if possible. This will ensure a good report. If you cannot pay the entire amount within the stipulated time, you might have to pay interests. Also, try not to pay the bill late. This will have a negative effect on your credit history.
Keep Your Old And Unused Credit Cards
Chances are, there might be unused credit cards lying in your wallet. Wait! Do not throw them away. Thanks to a gem called a credit utilization method, even your unused credit cards can boost your credit score. This ratio measures your total available credit limit and the amount of credit that you have used. If you use too much of your credit balance, it might affect your credit score. When you have multiple cards, even if they are not used, their credit limit gets added up, and, thus, it gives a boost to your credit history.
Before going into retirement, it is necessary to know information like this that will help you once you have retired. A credit score is important throughout your lifetime. So, never neglect your credit history as doing so will ensure you a more relaxed retirement.
More in Saving & Refinance
Rafa Nadal Shocks the World by Proposing to Girlfriend of 14 Years, Mery Perelló
Wedding bells are ringing loud for Rafa Nadal and his girlfriend, Mery Perelló. The pair, who dated for 14 years had...January 31, 2019
You’ll Never Guess How Young These Billionaires Are!
When we hear the word ‘billionaire’ our mind can immediately go to picturing an older person who doesn’t really care about much...January 31, 2019
How Lisa Niemi Spends Her Days After the Death of Husband Patrick Swayze
Patrick Swayze was an American actor, songwriter, and singer, who gained fame in the 80s for his leading role in romantic films....January 30, 2019
If You’re A College Student, Here Are The Top Five Rules to Saving Money
Being a college student is a life of going from one adventure to another, learning while having fun, and… being completely broke?...January 29, 2019
Three Habits That Will Help You Lead A Healthy Lifestyle
The first month of the year has almost passed which means all the people who had “get more fit” in their...January 29, 2019
How Ralph Lauren Rose from Poverty to Create a $12 Billion Fashion Empire
The American Dream can be expensive and even near-impossible for many citizens of the country which is why most people find hope in...January 27, 2019
Why Online Money Tips Won’t Make You Wealthy
If you are always looking for a way to get rich quick, you probably read a lot of personal finance management...January 27, 2019
Facts You Need to Know About Angela Bassett’s Life
Angela Bassett is no stranger to movies portraying strong African American ladies. Bassett has a career that has spanned over a...January 26, 2019
Alan Rickman’s Final Act of Generosity Before Death Will Bring You to Tears
Even in death, Alan Rickman has shown that he was a generous soul. Before the tragic death of the actor, he...January 25, 2019