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Okay thanks.I am thinking about getting a credit card so i might have a credit score by then.
good plan
the "7 steps to 720" plan recommends never exceeding 30% of your utilization rate to build your score the fastest...... but use it frequently..... a dormant card does nothing for the score
example: if the card has a $1,000 limit, use it for normal expenses, gas, food, utilities etc up to $300 (30%) then promptly pay it off to avoid interest..... repeat monthly...... every month
you will be at 720 before you know it (720 is widely considered the score needed for top tier rates with lenders and insurers)
FHA mortgage minimum = 580
Conventional mtge min = 620
the "7 steps to 720" plan recommends never exceeding 30% of your utilization rate to build your score the fastest...... but use it frequently..... a dormant card does nothing for the score
example: if the card has a $1,000 limit, use it for normal expenses, gas, food, utilities etc up to $300 (30%) then promptly pay it off to avoid interest..... repeat monthly...... every month
you will be at 720 before you know it (720 is widely considered the score needed for top tier rates with lenders and insurers)
FHA mortgage minimum = 580
Conventional mtge min = 620
Okay thanks very much,azsportpilot.I appreciate it.
Well, I am thinking about getting a credit card when I do get established in my job because of fraud protection.I think home mortgages are okay but I am going to try the 100% down plan for that.I dont like to finance depreciating assets.I also do not want to live paycheck to paycheck like 70 percent of people in this country but thats just me.Also, if I did get a card I would set up to pay in full automatically each month like your self.Thanks for your input,Bongo.
You sound like you have a great head on your shoulders. Good for you for wanting to be financially responsible, which is so unlike much of the country and many people in your age range. If you're in your early 20s you are in a unique position to start saving aggressively now so you can be financially independent by the time you're 40. When I say financially independent I don't necessary mean retired, but at a point where you could survive off of passive income streams (interest from investments, real estate) supplemented with work that may not necessarily pay a fortune but makes you happy. I've known people in their 30s that became financially independent and basically just lived off their investments plus the freelance work they did while they backpacked across Europe. Check out the financial independence sub on Reddit.
Also I would contest your assertion about home mortgages. It's great if you can get one for 100% down, but if you're not planning on owning the house for a few years you might as well rent with some room mates or even live with parents if they'll let you. And even then putting down 20% is often a good financial move in many cases, but that's a whole can of worms for another topic. Homes are generally appreciating assets in most markets, not depreciating, although you should treat homes like a place to live rather than a financial investment. Also unless you're married with kids, there's no reason someone in their 20s should be throwing away 1/3 or more of their post tax income on housing if they could save more by living with room mates or family. Live like a college student for as long as you can so you can save as much as you can. Don't give into social pressure or your peers where you have to waste all your money on a nice car or house.
You sound like you have a great head on your shoulders. Good for you for wanting to be financially responsible, which is so unlike much of the country and many people in your age range. If you're in your early 20s you are in a unique position to start saving aggressively now so you can be financially independent by the time you're 40. When I say financially independent I don't necessary mean retired, but at a point where you could survive off of passive income streams (interest from investments, real estate) supplemented with work that may not necessarily pay a fortune but makes you happy. I've known people in their 30s that became financially independent and basically just lived off their investments plus the freelance work they did while they backpacked across Europe. Check out the financial independence sub on Reddit.
Also I would contest your assertion about home mortgages. It's great if you can get one for 100% down, but if you're not planning on owning the house for a few years you might as well rent with some room mates or even live with parents if they'll let you. And even then putting down 20% is often a good financial move in many cases, but that's a whole can of worms for another topic. Homes are generally appreciating assets in most markets, not depreciating, although you should treat homes like a place to live rather than a financial investment. Also unless you're married with kids, there's no reason someone in their 20s should be throwing away 1/3 or more of their post tax income on housing if they could save more by living with room mates or family. Live like a college student for as long as you can so you can save as much as you can. Don't give into social pressure or your peers where you have to waste all your money on a nice car or house.
Thanks bongo, I really appreciate it .I think I will buy a house after I get married and have kids.I do not really see the point of buying when I am single because I want to move around a lot in my younger years.I really appreciate your kind words.I am planning on starting a business that generate passive income to help achieve financial independence.However, that is a few years down the line.I am saving money in a index fund now.I live with my parents currently.I drive cheap used cars.
No credit is better then bad credit. start building it.
Wrong. No credit is equivalent to bad credit as lenders have nothing to gauge how you will pay your bills. But, to the OP's question, credit will not likely come into play when applying for jobs. And for jobs that do require credit checks, this is usually stated in the job description.
Wrong. No credit is equivalent to bad credit as lenders have nothing to gauge how you will pay your bills. But, to the OP's question, credit will not likely come into play when applying for jobs. And for jobs that do require credit checks, this is usually stated in the job description.
I am a university grad in Texas.I am in my 20's and I am looking for my first job out of college.I do not have a credit score because I am a fan of Dave Ramsey.I do not go into personal debt.Will my lack of a credit score possibly cause me trouble getting a job?Thanks in advance everybody.
I highly doubt that. Texas has a strong economy and shortage of workers throughout the state. I worked in Austin and San Antonio and loved it.
The key is to have a skill in demand. If you majored in philosophy or theology or some other "non-work related" subject, the job search can get harsh. But if you majored in petroleum engineering, cybersecurity, electronic health records, mechanical engineering, business administration, etc., then you should have many opportunities.
Just practice interviewing. Research the company on Glassdoor, Indeed, LinkedIn, etc. Glassdoor is great to find out if there are issues in that work environment. Many former employees post anonymously on Glassdoor about their former companies.
For a job? Not likely. But it should help for other things. I'm about to apply for an apartment and that involves a credit check to determine how much the deposit will be.
And you should learn more about credit scores. It's a common misconception that getting a CC means you must take on debt and pay interest. I got my first CC a few years ago and have paid off the balance every time. I basically use it like my debit card, I buy only what I need (food, gas, etc) OR use it when I know I (will) have the money to pay for whatever.
You should get started now as one factor into the score is the amount of time you've had accounts. For me, my oldest accounts are my student loans. I paid off one of my first loans a year ago and my score DROPPED. It's just now recovered. As I get older it won't matter as much but with such a short history right now, any change is relatively significant.
Get a secured card (mine required a $50 deposit) and just spend a little each month and pay it off. If you're concerned you'll spend more than you can pay back, just go into your account every day and pay off the posted transactions from your bank account. (Your credit limit will likely be low anyway).
Feel free to message me if you want to learn some more. I'm only 25 and didn't get my first CC til right after I graduated undergrad. I'm not super rich. I don't do anything fancy, I don't use them to finance anything or transfer balances, etc. I just use the rewards (cash back) and make my CCs work for me. The companies make money off of the fees for vendors and suckers that don't pay off balances in full and accumulate interest. Now I have 4 and each one has it's own use.
For a job? Not likely. But it should help for other things. I'm about to apply for an apartment and that involves a credit check to determine how much the deposit will be.
And you should learn more about credit scores. It's a common misconception that getting a CC means you must take on debt and pay interest. I got my first CC a few years ago and have paid off the balance every time. I basically use it like my debit card, I buy only what I need (food, gas, etc) OR use it when I know I (will) have the money to pay for whatever.
You should get started now as one factor into the score is the amount of time you've had accounts. For me, my oldest accounts are my student loans. I paid off one of my first loans a year ago and my score DROPPED. It's just now recovered. As I get older it won't matter as much but with such a short history right now, any change is relatively significant.
Get a secured card (mine required a $50 deposit) and just spend a little each month and pay it off. If you're concerned you'll spend more than you can pay back, just go into your account every day and pay off the posted transactions from your bank account. (Your credit limit will likely be low anyway).
Feel free to message me if you want to learn some more. I'm only 25 and didn't get my first CC til right after I graduated undergrad. I'm not super rich. I don't do anything fancy, I don't use them to finance anything or transfer balances, etc. I just use the rewards (cash back) and make my CCs work for me. The companies make money off of the fees for vendors and suckers that don't pay off balances in full and accumulate interest. Now I have 4 and each one has it's own use.
Okay thanks sedimenjerry...I am thinking of getting a credit card and I would pay it off in full every month.
I highly doubt that. Texas has a strong economy and shortage of workers throughout the state. I worked in Austin and San Antonio and loved it.
The key is to have a skill in demand. If you majored in philosophy or theology or some other "non-work related" subject, the job search can get harsh. But if you majored in petroleum engineering, cybersecurity, electronic health records, mechanical engineering, business administration, etc., then you should have many opportunities.
Just practice interviewing. Research the company on Glassdoor, Indeed, LinkedIn, etc. Glassdoor is great to find out if there are issues in that work environment. Many former employees post anonymously on Glassdoor about their former companies.
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