Everyone loves earning perks, benefits, and bonuses, right? Credit card reward programs, brand loyalty programs, and even grocery store discount cards are built upon this very concept. Yet while most people can easily recognize the value of a credit card rewards program, there are still many consumers who do not see the value of having high credit scores in the same light. That is a costly mistake.
The truth is that great credit scores can help you to score a lot of awesome perks. Check out the list below to help you start viewing the potential value which you can start to tap into when you achieve great credit scores.
1. Saving with lower insurance premiums.
When you have excellent credit scores you can secure lower interest premiums. You may not be aware of this fact, but insurance companies routinely check credit scores (credit-based insurance scores) when you apply for a new policy. In fact, your credit might even be more important than your driving record when it comes to determining how much an insurance company will charge you for an auto policy. Premiums for home owner’s policies and life insurance policies are often based at least partially upon the condition of your credit as well.
Earning great credit scores could pay off every single month in the form of money saved on insurance premiums. If your credit has improved since you took out your current insurance policies, it’s probably a good idea to talk to your agent or shop around to see if you now qualify for a better price on your insurance coverage.
2. Saving on deposits.
When you open a new utility account it is often common practice for the utility provider to check your credit in order to determine whether or not you will be required to put down a deposit for service. As a result, when you apply for new electric service, gas service, cable service, or internet service having less-than-stellar credit scores might cost you. Additionally, when you apply for a new mobile phone account your credit will again be consulted, not only to determine whether or not you will be required to put down a deposit for service but to also see whether or not you qualify for a new account at all.
3. Saving interest costs every month.
Did you know that financing a home with a questionable credit rating could realistically cost you around $85,000 extra over the course of the loan? Here’s a look at the math. Purchase a home with a credit score of 620 and you might pay an extra $235 per month on a $300,000 mortgage compared to what someone with a credit score of 740 would likely pay for the exact same loan. Over the entire course of a 30 year mortgage that’s an extra $84,600 you would pay – a pretty expensive penalty for not having great credit scores.
If you have already overcome credit issues and have rebuilt great credit scores, you should probably take a look at your current loans (i.e. mortgage, auto, credit cards, personal loans, etc.). You may just qualify to refinance some of those loans at a lower rate and save yourself a bundle on interest.
4. Saving on vacations.
Having great credit enables you to land better credit card offers. Many credit cards offer exciting perks such as 0% interest on purchases for 12 months, generous airline reward miles which can be redeemed for free airfare, or even 0% financing with a specific resort or cruise line. However, the most attractive credit card offers are generally reserved for those consumers who have excellent credit scores.
Achieving excellent credit scores can open the doors for you to cash in on some amazing vacation deals. Of course, ideally you want to have the money saved back for your vacation in advance. Then you can use the credit card to score a great deal, but pay off your credit card balance in full before any interest fees are charged.
5. Saving face.
If you have ever applied for financing in the past and been turned down then you probably can recall a vivid memory of the red hot embarrassment which crept its way up your face when you heard the words, “I’m sorry, but your application was denied.” Simply put, bad credit can be very bad for your self esteem and your sense of self worth, especially if you are the primary bread winner for your family. Women in particular face a lot of stress where credit and money are concerned.
It is well worth the hard work required to build better credit scores just for the pay off of the added confidence you will receive once you achieve your goal. Knowing that you never again have to worry about being turned down for financing because of bad credit is truly liberating.
Earning Better Credit
It is completely possible to start earning better credit right away. However, just because it is possible does not mean that the process is easy. Earning better credit takes a solid plan, hard work, commitment, consistency, and patience. The good news is that you can achieve whatever goal you put your mind to achieving. You just have to believe it.