How Much is a Good Credit Score Really Worth?
Everyday, more of your expenses are determined by your credit score. The deposits you pay to start services like cable, internet, telephone, or utilities are higher if you have bad credit (if you have to pay them. Oftentimes people with good credit don't have to). The interest rates and finance charges you can end up paying on car loans, mortgages, student loans, and credit cards may be significantly higer as well. Now days, if your credit is bad, your car insurance can even be higher as well. How much is good credit really worth? You're about to find out...
But really, how damaging is it if you don't have good credit? The answer will probably surprise you:
You could, over the course of your lifetime, lose hundreds of thousands or even millions of dollars if you don't have a good credit score.
Let's use a simple payment like a car payment to show how this works. For someone with good credit, the interest rate on a car payment can be very low, around 3% to 4% (as of this writing). Someone with low or no credit scores can pay very high interest rates for a car loan, as high as 18% or more.
The payment on a $15,000 car loan with a 4% interest rate over 4 years is $339 a month. Were you to increase the interest rate to 15%, you're now looking at a $417 monthly payment. That's a difference of $78 a month, just because of your credit!
Now, take that $78 difference over the course of a year, and it's $936 a year more that you're paying because of your credit. Or, over the course of 10 years, you're looking at $9,360. That's a nice used vehicle every ten years that you lose, just because of your credit.
The real effect is seen over the long term. That $78 dollar payment over the course of 40 years (add up all your car loans from 20 years old to 60, for example) and you're looking at $37,440 dollars. And this doesn't even count the lost money from investing over time and the gains you can achieve over a lifetime.
A staggering amount of loss, all from a $78 difference in payment. Now imagine if we were talking about hundreds of dollars in additional payments a month?
Presently, someone with a good credit score can easily obtain a home loan with an interest rate as low as 4.5%. A home loan with bad credit: 9%. That creates a difference of $446 a month in payments on a $150,000 home load. Over 40 years, that's $214,080 or pure loss, without even counting how much you missed for not being able to invest. That could easily cover a couple of very nice college educations, or even a house!!
The list goes on and on with credit cards, insurance payments, etc. You could quite easily be looking at a difference of $700-$800 a month just for having a good credit score. That adds up to hundreds of thousands or millions of dollars over your lifetime!
The good news is that your credit score is something that you can learn how to control. If you have some issues in your past, you can repair those through learning how to repair your credit on your own, or by seeking the assistance of reputable credit repair professionals. And, last but not least, credit protection is a smart move for anyone, especially those with good credit. Identity theft is the fastest rising crime in our society.
Take control of your credit score as fast as you can. It's worth a fortune to you and your family.
But really, how damaging is it if you don't have good credit? The answer will probably surprise you:
You could, over the course of your lifetime, lose hundreds of thousands or even millions of dollars if you don't have a good credit score.
Let's use a simple payment like a car payment to show how this works. For someone with good credit, the interest rate on a car payment can be very low, around 3% to 4% (as of this writing). Someone with low or no credit scores can pay very high interest rates for a car loan, as high as 18% or more.
The payment on a $15,000 car loan with a 4% interest rate over 4 years is $339 a month. Were you to increase the interest rate to 15%, you're now looking at a $417 monthly payment. That's a difference of $78 a month, just because of your credit!
Now, take that $78 difference over the course of a year, and it's $936 a year more that you're paying because of your credit. Or, over the course of 10 years, you're looking at $9,360. That's a nice used vehicle every ten years that you lose, just because of your credit.
The real effect is seen over the long term. That $78 dollar payment over the course of 40 years (add up all your car loans from 20 years old to 60, for example) and you're looking at $37,440 dollars. And this doesn't even count the lost money from investing over time and the gains you can achieve over a lifetime.
A staggering amount of loss, all from a $78 difference in payment. Now imagine if we were talking about hundreds of dollars in additional payments a month?
Presently, someone with a good credit score can easily obtain a home loan with an interest rate as low as 4.5%. A home loan with bad credit: 9%. That creates a difference of $446 a month in payments on a $150,000 home load. Over 40 years, that's $214,080 or pure loss, without even counting how much you missed for not being able to invest. That could easily cover a couple of very nice college educations, or even a house!!
The list goes on and on with credit cards, insurance payments, etc. You could quite easily be looking at a difference of $700-$800 a month just for having a good credit score. That adds up to hundreds of thousands or millions of dollars over your lifetime!
The good news is that your credit score is something that you can learn how to control. If you have some issues in your past, you can repair those through learning how to repair your credit on your own, or by seeking the assistance of reputable credit repair professionals. And, last but not least, credit protection is a smart move for anyone, especially those with good credit. Identity theft is the fastest rising crime in our society.
Take control of your credit score as fast as you can. It's worth a fortune to you and your family.
