We all make mistakes when it comes to money but it’s the young people who have more difficulties due to inexperience. It could be that they just graduated, moving out on their own, or just getting their career started that makes it difficult to keep track of personal finances.
If you want to be financially secure, it is important to be on top of your finances as early as possible. Young adults nowadays make money mistakes that results in debt and financial instability in the future just because of lack of knowledge. So here’s several money mistakes and what you need to know to be smarter when it comes to your money management skills:
Spending based on emotions.
A lot of young individuals spend too much money just because it makes them feel temporarily good. Have a bad day? Go retail shopping to feel better. Something good happened? You deserve to treat yourself. This type of mindset should be avoided at all cost as mixing money and your feelings is never a good combination. Avoid shopping and think things thoroughly – the temporary fix will soon be gone but if you save up, you’ll be happier and more secure in the long run.
The benefits of a Costco Visa credit card may be too good to pass up.
This month, I decided to test the waters and sign up for a Costco membership. It is not often that I necessarily need groceries in bulk, being that I live in a household of two; however, having the ability to purchase other household items in bulk (like toiletries and cleaning supplies) along with other miscellaneous items, attracts me.
Among the advantages of their store discounts is the Costco Visa credit card, which was briefly discussed with me upon my signing up. In the moment, I did not have time to learn more, but I was provided with just enough information to want to dig. Actually, it was when the representative at Costco mentioned to me that she was able to rent a car for her recent trip at just $12 a day that my interest had been piqued. So, this week, I began to look into the benefits of a Costco Visa credit card.
About the Costco Visa Card
Costco always offered its own exclusive credit card to members, but previously it was with American Express. In June, the warehouse chain and AmEx broke up after sixteen years together, though, causing a bit of an initial upset among members. One would imagine with any big switch issues would arise, and this was certainly the case for Costco and its newly co-branded card with Cita. In fact, it took a little over two months for some customers’ problems to be resolved. This did, unfortunately, result in cancellations as well.
Despite this, Costco continues to push forward, providing even better benefits for members than they had with AmEx.
A 2% cash back on all purchases both in-store and through Costco.com
A 0% intro APR on purchases for the first seven months; then, the APR bumps up to 15.74%
An improved cash back percentage of 4% on gas purchases of up to $7,000 annually, and 3% on restaurant and travel purchases
Still 1% cash back rewards on all other purchases
Another perk is that you could even use this as a business credit card, still earning the same rewards. With every, perk, though, comes terms and conditions. Not to mention, it does also double as your Costco membership ID. And, I am all about versatile products.
Details to Keep in Mind
In order to know what fees I would be up against, I found Citi’s disclosures. In addition to the 15.74% APR after seven months, which actually varies based on the prime rate, there is a 22.49% APR rate for cash advances with either a $10 or 5% fee for the transaction, depending on which is higher. And, if there are any late payments, I would not only be subject to a $37 fee but also a 29.99% penalty APR, depending on creditworthiness. (Luckily, my credit is great.)
I would also want to be careful to make sure that my Costco Visa card was not charged with my annual membership fees since I do not feel I would want that.
If I keep my Costco membership, it may be worth considering their Visa card. The benefits of a Costco credit card are enticing. Although, I have found that other options may actually lead to more cash back on purchases like gas and travel, thanks to Consumer Reports Credit Card Comparison Tool. While Costco’s credit card claims to have more cash back rewards than any other card, I will have to take some time to consider where cash back rewards may work best for me along with comparing the APR rates and fees.
Do you have a Costco credit card? What do you think of its benefits?
It’s all done by computers; but even so, to be turned down for a credit card or a loan can feel like a very personal insult. The most likely reason is that you have a poor credit rating. You don’t have to get mad, you can get even—not by acts of revenge against the credit rating bureau, but by understanding how the system works and what you can do to make it work better for you.
What’s On My Record?
Your credit rating is held by three credit bureaus—Equifax, Experian, and Trans Union. Most of the information is the same across the three bureaus.
Whenever you apply for a new source of credit, the lender will check your rating. When you enter the credit agreement, they should also report your progress in repaying it.
Regular repayments of credit will result in a healthy score.
Failures in repayment will damage your score. It will also be damaged by every application for credit which is refused, so it can be something of a vicious circle.
How Can I Check My Record?
Each of the bureaus is required by law to provide you with one free copy of your report per year. You can obtain these online. It is quite a good idea to stagger the applications so that you get one every four months.
The information is quite complicated, but you should be able to spot any black marks that you do not recognize. Most negative information on the record should be removed after 7 years, while positive information should be kept for at least 10 years.
Identity theft is a growing problem, and someone may have used your identity to obtain a loan on which they have defaulted.
How Can I Change My Record?
If you spot any false negatives in your report, you must apply to the lender (not the bureau) to have them removed. If this is an error that you can show paperwork for, it can usually be rectified quite quickly. Some errors can take longer, especially if there is identity theft involved.
Over the long term, you can improve your rating by increasing the positive reports. Not using credit at all will not help, so take out appropriate credit and repay it on a tight schedule. Reporting by lenders is voluntary, so make sure that your lender will report positively.
Both checking your report and changing it can be time-consuming and complicated. There are agencies that will do it all for you, and software programs that will take much of the legwork out of the task. You can find out here about some of the leading software available.
Good Habits Pay Off
Although everyone faces the risk of identity theft and fraud, maintaining a good credit report is largely a matter of good habits, both by being careful about sticking to the terms of credit and by keeping a regular check on your reports. If the worst comes to the worst, don’t panic and set about putting things right.
Summer Griffiths is a Mom who takes care of the family finances in her household. She enjoys balancing the books and writes about personal finance in her articles.