Money Management Strategies Learn Personal Finance To Manage Compulsive Your Spending, Savings And Live A Debt Free Lifestyle

By Michael Hall

Become a money management superstar and learn how to manage money wisely, design a budget, handle expenses, settle debts successfully, manage debts and make smart investments. As most of us know, one of the most difficult things is to control money. Money is one of the most important things that can be used to serve our goals, but it also is one of the things we tend to overspend, misuse and lose money on.

 

In our short-sightedness, we often mistake significant pursuit for the important things that we should be focusing on. Such as the pursuit of money instead of the things that really drive us. 

 

Money is not a short-term goal, and it is not interchangeable with success. If what you want is a lot of money, you might have success and happiness for a while. But there is no guarantee that you will be either successful or happy forever.

 

I know, I know, it is difficult not to admire the big paychecks, large investments, the luxury, the parties or the lifestyle that money provides. People, who are driven by consuming money, tend to be unhappy. When the money is not enough, they need more. When they have enough money, they need more again. You know what I'm talking about.

 

People who are driven to use their money for success and financial freedom are an exception. That is because when you make your own success, you are ultimately in a position of strength and freedom that cannot be taken away from you. So ask yourself how you want to use your money? If you want your money to serve you, then find a way to make enough money to meet your needs and fund your dreams.

 

You will never have enough money if you want to use it to fulfill all of your desires. But if your goal is to have money to use to do what you want in life and get the things you want, you probably will never get to your financial goals. If your goal is to have the money to fund your freedom to do what you want in life, then you will soon be able to do what you want without worrying about money.

 

How do you make enough money to have the freedom you want in your life and to have the money to do what you want in life? First, you need an end goal in life. Your goal does not have to be the best or the richest or the biggest. It just has to have enough certainty that you can focus on it and be able to tell the future how much money it takes to reach your goal. You want to work towards your goals and have the money to build the value you want.

 

Is it worth it to pay what it takes to get what you want? If you have a goal, you do not have to answer that question. Developing a goal and working towards it, you will see your goals increase in value and your motivation will increase as you move towards your goal.

 

What are you waiting for? Design your life and make your dreams a reality.

• Language: English
• Publisher: Michael Hall
• Release date: Nov 20, 2020
• ISBN: 9781386518662

Michael Hall

Michael Hall grew up in Ann Arbor, Michigan, and lives with his family in Minneapolis, Minnesota. He is the creator of numerous acclaimed picture books for children, including Frankencrayon, Red: A Crayon’s Story, My Heart Is Like a Zoo, Perfect Square, and It’s an Orange Aardvark! 

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Your Credit Score and Why It Matters

Your credit score is hugely important if you want to buy a house or car, or if you want to get a credit card. Financial institutions and other companies use credit scores - which are based on your credit report - in order to determine how likely you are to pay back a loan.

This makes a lot of sense. Financial companies and lenders risk losing money if they treat all customers the same. Some people deal with money more responsibly than others, thus, have better credit quality and lower default risk. Credit scores are a way for financial companies and lenders to assess how you have dealt with money in the past, and, based on this information, predict how likely it is that you are going to pay back your mortgage, auto loan, or credit card debt.

One particularly often used scoring method results in the so-called FICO score, which I am sure you have crossed paths with already. FICO stands for the Fair Isaac Corporation which was one of the first companies to calculate credit scores. Most financial companies today use FICO scores in order to decide whether or not to approve you for a mortgage or a car loan. 

Companies that collect credit information from you are Experian, Equifax, and TransUnion. Credit scores are calculated based on differing methodologies that take into account the length of your credit history, type of debt you owe, current state of your debt, whether or not you are a new loan applicant, etc. As a result, it is not unusual at all for all three consumer credit reporting companies to calculate a different FICO score for you.

According to the Federal Trade Commission, you are entitled to one free credit report every 12 months from each of the three consumer credit reporting companies: Experian, Equifax and TransUnion, and you should get them. You can request your credit reports free of charge on the website AnnualCreditReport.com, or follow the steps outlined on the website of the Consumer Financial Protection Bureau.

What is important to understand is that it is not only banks and financial companies that take a look at your FICO score in order to assess your credit worthiness, which is something a lot of people may not have realized yet. Your credit score - which really is a score of your financial behavior - is of interest to a lot of people, especially those that may consider entering into a business or financial relationship with you.

Parties that are interested in your credit score include prospective employers, business partners, insurance companies, mobile phone companies, advertisers, or landlords. It is in your very best financial interest to keep a good credit score and, if possible, raise it.

What Is a ‘Good’ FICO Score?

FICO scores run from 300 to 850. Obviously, the higher your FICO score, the more favorable a bank, for instance, will view your loan or mortgage application; for example, you have a much better chance of getting a lower interest rate on your requested mortgage loan when you have a high FICO score. From the bank’s point of view, a high FICO score signals a high likelihood of you being able to repay your loan. 

A FICO score in the range of 670-739 is generally considered to be good while a score between 740-799 is seen as very good. A score of 800 or higher is as good as it gets, all but assuring you the most favorable credit terms. The majority of Americans, 67% (according to Experian), have a FICO score of 670 or above. 17% of Americans have a FICO score of 580-669, and 16% of Americans have very poor FICO scores ranging from 300-579. The overwhelming majority of delinquencies occurs in the 669-or-lower FICO score group.

5 Factors That Influence Your FICO Score

A couple of factors impact the calculation of your FICO score, and some have a higher weighting than others. Here’s what influences your FICO score:

●          Your payment history (35%);

●          How much debt you owe (30%);

●          The length of your credit history (15%);

●          How much of your credit is new (10%);

●          What types of credit you use (10%). 

Your payment history is by far the most influential factor for the calculation of your credit score. The more reliable you are when it comes to making payments on time, the higher your FICO score will be, and the more trustworthy you will appear to a lender.

What Can You Do to Boost Your FICO Score?

You can do quite a few things in order to ensure that you get a high FICO score, or raise your current FICO score. The single most important thing for you to do is to pay your bills on time.

It never ceases to amaze me how many people don’t pay their bills on time. It’s mind-boggling to me. You have a bill to pay? Pay it. And pay it on time. If you are one of those people that tends to forget things, set reminders in your calendar a day before the bill is due, and make a conscious decision to stay on top of things. 

Paying your bills is not something that you should forget. Not paying bills on time reflects poorly on you and can lead to higher costs down the road if you are pressed to pay late fees. Make it a habit to pay your bills on time. I, for instance, always have to pay my utility bill on the 4th day of each month. I never forget it. You know why? Because I made it a habit to pay my electric bill on every 4th day of the month. Paying your bills on time is a key skill that you need to master, especially if you are shooting for something as ambitious as financial freedom.

There are a couple of other things that you can do in order to boost your credit score. One thing is to not max out your credit line. A maxed-out credit line is a red flag for many banks and indicates poor financial management, whether that may be true in your case, or