In case you hadn’t heard, everyone needs good credit! Believe it or not, even those in retirement need a solid credit score. Need to know why? Keep reading!
Why Is Credit Score So Important For Retirement?
Mortgage And Insurance
If you think retirement will find you free of bills and payments, think again! Almost all retired individuals still need to deal with, at the least, mortgage and insurance. And a good credit score will mean lower monthly payments! That means fewer leaks in your retirement fund and more cash to spend on what you want.
Repairs And Renovations
Most people in retirement do not zip around as much as they once did. So, more often than not, the elderly hire people to perform repairs and renovations. While your credit score won’t affect day-to-day repairmen’s fees, more extensive construction projects may require a credit score check. Once again, those with lower credit scores will almost certainly be required to pay more or higher bills!
Healthcare
As you might imagine, the same rules apply for healthcare payments. In the case that someone in retirement needs to entire a care facility, those with worse credit will find themselves paying more.
That enough to want to make sure you make it to 65 with great credit? Well, there’s good news! It’s pretty easy to maintain a solid credit score, if you’re diligent.
How To Maintain Good Credit
Deal With Debt
Without a doubt, debt will wreck your credit score more than anything else. So, prioritize paying off bills, whether they are big or small. If you don’t know where to begin, take a look at one of our debt articles. However, in essence, start with the larger debts, like home or credit card debt, and work down from there. But make sure you don’t close your credit card accounts – this move will ruin the acquired credit score very quickly! Instead, leave them and continue growing the credit.
If you’re drowning in debt, focus on that before worrying about retirement or your credit score. If things are really bad, hire a debt specialist or consider debt consolidation with your financial advisor.
Pay The Bills
Paying the bills is such a usual and mundane task that some forget that it’s a staple for good credit. Make the payment on time because even the 30-day payment misdeed will make the score drop around 90 to 110 points. “Set up auto payments so you never forget to pay your bills on time,” said Stephanie Genkin, fee-only financial planner and founder of Brooklyn, New York-based My Financial Planner.
After checking all the steps, make sure to save a few links and download apps that can curate credit scores. Moreover, some of them help grow or maintain the number, which is always a great idea closer the person gets to retirement age.
Sources: Finance101, MarketWatch