How fit are your personal finances?

How fit are your Finances?

How fit are your Finances?

Applying for a new loan or credit card is a competitive business, with the best deals going to the people who have the fittest credit history. If you want to be in the running, you need to remember the old fable and act like the tortoise, taking time to manage your money, rather than the hare who rushes ahead regardless.

This quiz will help you to discover whether your finances are in good shape – and whether you’re a steady tortoise or a scatter-brained hare.

1. You want to change your credit card. Do you:
a) Use a price comparison site to find the best offers and get a quote before applying
b) Check out a few deals and then apply
c) Reply to as many ads as you can because one of them is bound to say yes

2. Your income isn’t stretching as far as it used to, so you:
a) Make sure you’re getting the best deals on your household bills and cut down on luxuries, such as take-aways and nights out
b) Ask friends or family if they can lend you a bit to tide your over and start looking for another job
c) Max out your credit cards – after all, that’s what they’re for

3. You check your credit report:
a) Every now and then – you want to be sure that everything is up to date and accurate
b) Only if there’s a problem with an application
c) What is a credit report?

4. You pay bills and make repayments:
a) On time and in full every month
b) Mostly on time but sometimes struggle to pay the full amount
c) Whenever you can – it doesn’t matter if you miss one occasionally

5. You think you are a good prospect for lenders because:
a) You’re a responsible borrower and live within your means
b) You’ve had a few problems in the past but your finances are back on track now
c) You’ve already got lots of credit accounts so you must be doing something right

6. When they decide what offer to make you, lenders:
a) Take into account your credit history, as well as the information on your application
b) Just use your application form and supporting documents
c) Are only interested in whether you earn enough to cover the repayments
Mostly As

Your sensible and considered approaching to managing money means that you stand a good chance of getting the offers you want but you would benefit from keeping a closer eye on your credit report. You can see your Experian credit report now with a free, 30-day trial of CreditExpert. Checking your report more often will not only help you to stay on top of your finances but also protect you from ID fraud by allowing you to spot any suspicious activity.

Ways to improve your financial fitness:
• Always check your credit report before making a new credit application, to ensure everything is up to date and accurately reflects your circumstances
• Close unused accounts, especially joint accounts held with an ex – their financial problems could affect your ability to get credit so you should de-link your credit reports as soon as you can.
• Protect your identity (ID) – if criminals manage to borrow money in your name it can take months to put right and ruin your credit rating

Mostly Bs

You are a bit too complacent to be a winner in today’s tough credit climate, so you need to do a bit of work to get your credit report in shape.

Ways to improve your financial fitness:
• Always make your repayments on time and in full – if you don’t, the evidence will stay on your credit report for at least three years and could convince lenders that you’re unreliable
• Register to vote at your current address – lenders use this information as a precaution against fraud, to check that you live where you say you do
• If special circumstances, such an illness or accident, explain previous problems, try adding a note of explanation to your credit report

Mostly Cs

If you rush into a credit application now you are likely to be disappointed because you haven’t moved with the times. To have a chance of victory in the race for credit you will need to slow down and give your finances a major work-out. Start your financial training sessions with a look through your Experian credit report – it’s free with a 30-day trial of CreditExpert. This will remind you how much you already owe, show how well you’re coping and whether you can really afford more credit.

Ways to improve your financial fitness:
• Identify which debts are costing you most and devise a strategy for paying them off
• Go through your income and outgoings, set yourself a budget and stick to it -be realistic and build in some occasional rewards
• If you are having problems, talk to your lenders first – you can also get free expert help from Citizens Advice at www. adviceguide.org.uk, National Debtline at www.nationaldebtline.co.uk and the Consumer Credit Counselling Service at www.cccs.co.uk
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One Response to How fit are your personal finances?

  1. Sebastian Aspland January 18, 2010 at 1:54 pm #

    Interesting guide. It is important to make sure you don’t hurt your credit record.

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