I learned far more than I expected to when the guest speaker came to talk to our Intro to Business class about credit. I thought having a credit card wasn't such a big deal until I learned how dangerous it can be for certain individuals. Insurance companies, who already rip people off as it is, check people's credit to determine their premium. This can make a big difference for people when it comes to circumstances such as house and car payments. Not only do insurance companies check your credit scores, employers and banks check it as well. When I purchased my phone earlier this year I switched services and the cell phone company even checked my mom's credit.
Most people checking credit use a system called FICO. The FICO system rates people's credit going up to 850, with 850 being the best. Ways to make your credit score drop include:
*spending big at the wrong time
*having payments that are too thin
*being a payment slacker
*being too tidy
and
*being nonchalant
If you have to file for bankruptcy it will remain on your credit profile for four years and if you miss a house payment, that will stay for two.
Another credible site for college student to use when researching information about credit scores is this one. It shares the rates of each score bracket along with other information as well.
When the business class divided up to meet with our mentors, one of my mentors, Joe, told us a story about credit and how it can lead to trouble owning your own house when you are an adult. That on top of everything the speaker shared with us was a wake up call for me and how I will manage my money.
