Credit Score and Money Essay examples

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Lesson 1
For the previous month, list all of your sources of income and all of your expenses on a spreadsheet. Compare them and see if you are running a surplus or a deficit. Did you have any funds left over to save or invest? How did you handle those funds?
On your spreadsheet, catalog each of your expenses from the previous month and group them by category. Then, separate those categories into fixed expenses you will have each month and expenses that are discretionary
Look more carefully at your “fixed expenses.” Do you see a way that you could actually reduce some of them? For example, you might be able to cut your utility bill through conservation or your rent by moving to a different apartment. Or you might be able to do some shopping around and find a better cell phone or cable TV plan. Are any of these options worth pursuing so you are able to save more each month?
List several big purchases you’d like to make over the next year. Do you have a plan to save for those purchases?
Lesson 2
Do you have one or more credit cards? If so, carefully review the last two months of your credit card bills. Did you incur any late charges? Do you have an unpaid balance? What is the annual percentage rate you are being charged? Compare that to the current rate of interest on a 30-day treasury bill. (Try www.bloomberg.com for that information.)
If you do not have a credit card, go to the Internet and shop the various kinds of cards available at companies like MasterCard, Visa, and American Express. Look carefully at the terms and conditions. Is there an annual fee associated with the card? If you decide to get a credit card, be careful to limit yourself to only one card – otherwise, you will hurt your credit score (as discussed in the next lesson).
If you do not have a savings and checking account, make a personal visit to at least one bank and one credit union and explain to them that you are considering opening accounts. Gather information on what the fees charged might be, the interest rate offered on deposits, and whether you could obtain a debit and credit card with the account. We are not encouraging you to go out and get such cards – that’s your choice. But you would be well-served by knowing your options.
If you already have a savings and checking account but don’t have a debit or credit card, visit your bank and ask to talk to a representative about your options.
Lesson 3
Request your free credit report from each of the “Big Three” credit bureaus, Equifax, Experian, Transunion. Beware there are websites that will try to charge you -- you must find the ones that are free. Once you receive those reports, study them carefully. Compare each of the three. See if there are any errors; if so, make sure you ask that they be corrected.
If you can afford it, request a credit score from at least one of the credit bureaus and see where you stand. Is your score low because you have little or no credit history? Is your score low because you haven’t been paying your bills on time? Or maybe you have a very high score – good for you! The point is: assess your creditworthiness and wherever you stand, try to move up using the tips from the lesson.
Lesson 4
Get on the web and find a couple of sites that are offering home mortgages. Compare the rates on a 15-year versus a 30-year fixed rate mortgage – are they the same? Then look at the same rates on adjustable 15-year and 30-year mortgages. What have you learned?
Find a “mortgage calculator” website that allows you to calculate your fixed monthly payment on a 30-year mortgage at rates of 5% and 10% using the annuity formula approach.
On the web, find a site where you can review the terms and conditions of various car loans. If you have time, visit a reputable car dealer, tell them you are doing some research on car loans (which
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