Your credit score is given to you in a 3-digit number that ranges from 300 to 850. If you have never dealt with any credit before, it is possible to not even have a credit score. However, if you have dealt with credit, the worst score you can have is a 300. A perfect 850 credit score happens by consistently nailing all of the 5 criteria listed above for many, many years. Here is how Experian breaks down different credit scores:
So, what is your credit score? If you're reading this blog and you have made it this far, clearly credit is very important to you. I hope you have enjoyed the education thus far, but now I want to transition to you! Why are you reading this right now? Is it because you're just curious about credit and want to learn? Is it because your credit is poor, and you know you should be doing something about it sooner rather than later? Is it because you have an immediate goal in which your poor credit score is getting in the way? If you answered yes to any of these questions, stick with me as we dive into how you can make a change today!
There are two focuses when it comes to correcting a negative credit score: your past and your future! Let's start with your past. Above, I listed the different criteria that are measured to calculate an individual's credit score, but what exactly makes a credit score bad? Here are the top 8 things that destroy a person's credit score:
Late Payments
Debt Collections
Charge Off's
Repossession
Foreclosure
Judgments
Tax Liens
Bankruptcy
Let's just be honest with one another - poor financial management in our past is what led to our current situation and our current credit score. Nobody is perfect, and we have all made mistakes. As you can see, simple mistakes such as missing payments all the way to major mistakes that cause things like bankruptcy all come into play. Is it embarrassing? Sure. Does it cause shame? Of course. Should it? Not if you take action to change it! Admitting fault and seeking help is one of the most difficult yet admirable things anybody can do. If you are ready to face these mistakes, I want to help you change your trajectory right now!
The next focus we have to address is your future. How does one move forward? Simple! First, we need to correct the habits that led to these mistakes. In order to do so, we must tackle the following 4 criteria:
Organization
Financial Awareness
Control
Having A Plan/Building A Trajectory
If you hope to be able to grow your credit score, you have to get organized! List out everything in regards to your personal finances. How much money do you bring home each month? What are all your bills? What are your debts? What do you spend on things like groceries, eating out, toiletries, home supplies, fuel, etc.? I highly recommend using a strong budget that is clean, organized, easy to use, and ideally automated (nobody likes math). Once you have everything laid out and organized, you must become fully aware of where your money is going. This can ONLY happen by tracking your expenses for at least one month. Once you have full awareness of your money, you must address your spending habits and take full control. This can only be done by exercising inner principles such and discipline and self-control. I always teach our members, "Money is nothing but a tool. If you are good with it, you can control it. If you are bad with it, it WILL control you!" Lastly, once you are organized, fully aware of your finances, and have a tight control on your spending, you can then begin to build a plan (or trajectory of growth as we teach our members).
Earlier, I stated that this journey was simple, but I never said it would be easy. It is going to take hard work and dedication, but I promise - it is a small price to pay for financial freedom! We want to walk with you through this journey.
We have also created several Coaching Packages to help you through this process however you feel best suits you. Inside our membership, we also teach additional strategies such as the Metanoia Credit Strategy for maximizing your credit growth!
Whether you are trying to get ahead and build a strong credit score from the start, have made mistakes in the past and need to repair your credit score, or you are trying to boost your credit score for an immediate goal, please email us right now at [email protected] to set up a FREE Consultation or check out some details about becoming a Metanoia Member. We look forward to hearing from you soon!
