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Your Credit Score, Your Money & What’s at Stake

How to Improve the 3-Digit Number that Shapes Your Financial Future

On the road to $1M rating:

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Written in the direct, no-nonsense style characteristic of Liz Pulliam Weston, this comprehensive guide to credit scores is a must-read for everybody, independently of their financial health.

Those who have a bad credit score will learn how this affects their chances of getting credit, and how to start working towards improving it.

Those in financial trouble will find out if they can avoid damaging their credit score, or whether their situation is so critical that a bankruptcy filing has become their best option. Even in that is the case, this book will teach you what to expect during the bankruptcy process, and how and for how long it can affect your financial life.

People who have no or little credit history will learn about the importance of building a credit record. The author dispels a few common myths, such as the beliefs that you don’t have to use credit score; or that your credit score is not important if you don’t need to apply for credit in the near future.

And the most important feature of this book is that even people with good or great credit will benefit from reading it, since it will teach them how their scores are computed and what to do to make sure they stay that way.

The main lesson from Your Credit Score is that your credit scores shape your financial outlook and can determine not only whether or not you are approved for a car or personal loan, mortgage or credit card, but also many other things such as:

  • how much interest you pay on your credit card
  • your credit card limits
  • your insurance premiums
  • whether you’ll get financing for a business
  • whether a prospective landlord will accept you as a tennant
  • whether you’ll the best deal for your cell phone contract

And the list gets larger. Apparently, even some hospitals have started checking credit scores before a patient is admitted.

The book starts with a comparison of two fictional women who go through life making similar financial decisions. They buy the same houses and cars and carry the same balances in their credit cards. The only difference between them is their credit scores. And what a big difference that is! According to Weston’s calculations, in the course of their lifetimes the woman with the higher credit score would have saved $2 million in interest (on the car loans, mortgage and credit cards) with respect to the one with the lower credit score.

Exaggerated? Maybe, but having read Weston’s book I’m convinced that it’s not worthwhile to take a chance. Protecting my credit score has become one of my financial priorities. The book showed me a number of ways in which my credit score could be harmed that I didn’t know about.

I’ll recommend this book to anybody interested in managing their own finances, but even more so to those who are interested in having their money work for them. Keeping an eye on your credit score can save you money. David Bach puts it best on the back cover: “A great credit score can help you finish rich!”.

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