Repair Your Credit Profile

Hello and happy halloween-

This article talks about taking the time now to do a financial checkup. Get a jumpstart on the new year (yes, it’s about that time already) and get a handle on your finances.

The author discusses a few more topics than the ones I’ve highlighted below but these are the ones I wanted to discuss further.

Accountability:Â

• Know the current status of your finances.
• Reconcile your accounts.
• Write down every transaction, especially when you use money in your checking or saving accounts.

I’m not the best at this becuase I do not like balancing my checkbook. But I do have a pretty good idea of how much money I have in my accounts and could tell you within a few dollars of what it is.Â

Plan:Â

• Start saving.
• Establish a cash reserve fund of a minimum of one month’s expenses.
• Establish an emergency fund to be used for unexpected expenditures.
• Establish a fund to be used for wants or desires.
• Establish a debt elimination plan.

This one I am pretty good at. I do have a little bit set aside for rainy days that will last me for a few months in case any emergencies arise. I also have credit cards with some room left on them if I ever need to access them.Â

Priority:Â

• Prioritize your spending. Ask yourself if it is a need, a want, or a desire.
• Will this purchase or expense affect your ability to honor your current commitments?
• How will the decision you are making affect your overall goals for the year?

I know there are many of us who buy things on credit and say we are going to pay them off before we get the bill so we don’t have to pay any interest and then life happens and we let it slide for one month and then another and then a few and that $200 DVD player becomes a $500 DVD player after we finally get it paid off with all the interest charges.

If you’re really in a pinch, ask yourself if what you are thinking about buying will really improve your financial situation or could I put it off for a few months and save up to pay for it with cash instead of going further into debt.

Doing that has saved me a few dollars over the past few years.

-Adam

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