Build yourself a healthy credit record

January 05, 2000|By Lynn F. Little

Building and preserving a good credit file is essential. Your credit record is a permanent one that starts as soon as you begin paying bills (e.g., rent, car payment) and borrowing money.

Skip your bill payments, pay bills late or abuse your credit and credit companies will enter a black mark into your credit report.

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Your credit report is distributed to someone to whom you apply for credit; for example, to buy a car or pay college tuition, and prospective employers even may request your credit report before they hire you.

When you purchase big-ticket items like a car or a home, chances are you are doing it with a bank's money. Banks and all other lenders, as well, want to lend money to people who have a good track record paying their bills. If you have large credit card debts that you can't pay on time, you may be headed down the road to financial ruin.


Just starting out, you have the opportunity to create and maintain a sterling record that can benefit you for a lifetime.

Following are some simple tips that everyone should follow to maintain good credit or improve upon a less-than-perfect rating.

* Create a budget or spending plan so you know exactly where all of your money is going. Keep daily records of everything you spend for a month and decide where you can cut or save.

* Plan for large purchases such as a stereo or car. Put a fixed percentage of your income into a savings account each month to pay for these expenses, as well as birthday and holiday gifts.

* Pay yourself first. Deposit a fixed amount each month into a savings account to provide a cushion in case you lose your job or there's an emergency.

By managing your money responsibly now, you will be able to reach your financial goals as well as build and maintain a good credit history.

If you would like more information about credit history, send a self-addressed, stamped business-size envelope to Maryland Cooperative Extension, Washington County Office, 1260 Maryland Avenue, Hagerstown, Md. 21740. Mark the envelope, "Credit."

Maryland Cooperative Extension programs are open to all citizens without regard to race, color, sex, disability, age, religion or national origin.

Lynn F. Little is a family and consumer sciences extension educator for Maryland Cooperative Extension, Washington County.

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