What Does Your Credit Score Mean to You?

Personal Finance

For most individuals an excellent credit score means not having to fear being turned down for a loan and usually always qualifying for a reduced interest rate on a purchase of a car, house or credit card.  A superior credit score may also mean lower costs for insurance and having stability throughout your life.  Even so, in the last couple years, a credit score tends to mean much more. 

Recently, companies have started looking into a person’s credit score when hiring a potential candidate for an open position within an organization.  Employers want to confirm, that their hiree has certain credentials within their selection process.  By doing so they are able to view your credit score and see if you pay your bills by the due date and maintain a virtuous status with your creditors, ultimately displaying responsibility and credibility.  For the employer, this potentially indicates whether you will be reliable and dependable within the company.

 However, this makes it hard for a person trying to start over within a bad economy or who have had dings on their credit report.  Some people have been affected by unemployment and other circumstances, which have caused them to fall behind on their bills.  Therefore, they are not hired for the job and have to start back at square one.  It is unfortunate that a person’s credit score can keep them from providing for their family but a process more and more organizations are utilizing today.

Electric companies are also resorting to pulling a person’s credit score when they power their home.  In many instances electric companies will not activate your electric without a deposit if your credit score is lower than their standards, so again having a good credit score can keep you from paying more money even on simple utility bills.  Phone companies also pull credit scores for each consumer wanting a phone line for their home or a cell phone for personal use. Poor credit often requires a large deposit to activate your phone.

Basically, having a good credit score will affect you in many different circumstances and ultimately is a determining factor on how much money you will lose or gain.  Don’t make the mistake of ignoring your credit report and FICO score, it pays to practice paying your bills on time and keeping credit cards balances low.  Your credit score is a part of your livelihood, without it, you will continue to run into high rates and financial institutes that refuse to work with you.