We’re three months into 2017 and I don’t know about you ladies, but I haven’t kept up with all my New Year’s resolutions. One of the most important ones is learning more about how to get the most bang for my buck. Am I doing all I can to maximize my savings? How can I improve my credit?
We caught up with financial advisor and Chase Financial Education Ambassador, Brittney Castro at the We All Grow Conference in Long Beach last week to get all the answers that’ll get us on track.
To begin with, forget about what you’ve heard about savings accounts. The percentage you get back for stashing your cash at a large institution is a lot lower than it used to be but Brittney says it’s worth it for short-term goals.
“Savings accounts are not a waste of time for short term goals like building up your cash cushion,” she explained. “Typically, you aim to save about 3-9 months of your committed monthly expenses in a savings account. You may not get a lot in interest rate on the account, but your money will be liquid and available to you should an emergency come up like your car breaks down, you lose your job, etc.”
Ok, so don’t pull out all your money from savings and hide it under your mattress. But what should we do for something a little more long term? Investing is an extremely intimidating word that most of us rather not bother learning about but it can help you earn some coin—especially for your retirement.
“For long-term goals such as retirement, it is best to open up a retirement account and choose investments that can grow your money for the long term. Since investing can be complicated, it is best to work with a financial professional such as a Certified Financial Planner, who can help you build an investment strategy that matches your financial goal and risk tolerance.”
Ok, so what about our credit scores? I know that a lot of us have less than stellar scores and rather not even be faced with all that debt. It’s easier to ignore it but you’re not doing yourself any favors! This is something you could make more fun by sitting down in a nice cashmere pajama with a glass of wine. If that’s what it takes, do it!
“You want to get in the habit of checking your credit score at least once per year. Use tools that empower you to make savvy financial decisions,” Brittney said. “Chase introduced the Chase Slate Credit Dashboard with a FICO® Score & More feature that provides you a graphical analysis of a 12-month trend of your monthly FICO® Score for free. On the Slate Dashboard, you can see the top positive and negative factors impacting your score, a summary view of your credit bureau information and helpful suggestions on how to manage your credit health.”
So what can you do to grow your score into numbers that you are proud of? Brittney has a nice list of suggestions that seem completely doable. It’s like anything else in life, it’ll take hard work, dedication, and patience to get there, but it’s one of the best gifts you can give to yourself.
“It’s important to know that repairing or improving your credit score can take time, although there are some ways that you can begin improving it right now.
Here are 3 Ways to Improve Your Credit Score:
Check Your Credit Report
Make sure you check your credit report annually. Review your credit report for errors and make sure that the amounts you owe are correct and that there are no late payments incorrectly listed. If there are any errors on your credit report, dispute them with the credit bureau and reporting agency.
Set Up Payment Reminders
Paying your credit payments (credit cards, car loan, student loans) on time is one of the biggest contributing factors to your credit score. Enroll in automatic payments through your credit card and loan providers to have payments automatically debited from your bank account. Also, schedule reminders in your calendar to make sure you always pay your credit payments on time.
Reduce the Amount of Debt You Owe
Since your credit score is also based on your debt ratio (i.e. how much balance you have vs. your total credit limit), reducing the amount you owe can help increase your credit score. So if you have a balance on your credit cards, the first thing to do is stop using them. Then make a list of all your credit card accounts to determine how much you owe on each account and what interest rate each one is charging you. Come up with a payment plan that allows you to make additional debt payments starting with the highest interest rate first, while at the same time maintaining minimum payments on your other accounts.
I hope this motivates you to take control of your financial lives and inspires you to learn more about these important topics. If you have any questions pertaining to finance for Brittney, leave them in the comments and we’ll consider them for a future piece.
