A credit score is a bit like the Da Vinci Code; it’s a serpentine web of myth and mystery that’s hard to crack. But there is a Holy Grail of sorts here too. Of all the different factors that feed into your credit score, many experts believe that there is one factor that stands above the rest in keeping your score high. The fact that this one ratio is so important is a little counterintuitive, so simply understanding its importance can unlock the higher credit score you’ve been looking for.
So what is it? It’s called the credit utilization ratio. Learn more about it in my new post on WiseBread.
Perhaps you’ve fallen on hard times or made some financial mistakes. If you’re lucky, you’ve learned from those mistakes, and are on better financial footing. Even so, it can take some time for your credit score to reflect that, making it hard to get any kind of loan or mortgage. If you’ve already been turned down by your bank for a mortgage, you may not realize that it’s actually quite easy to get a loan when you have bad credit. The catch is that you’ll pay through the nose for it.
Getting a mortgage when you have bad credit means making some concessions in terms of the price of the home you buy and the interest rate you accept. Plus, if you want to stay on firm financial footing in the future, you’ll also have to make a serious effort to improve your score.
Check out a few options to consider in my new post on Dividend.com.
Some people will argue that credit cards are an irredeemable financial evil. They certainly do lead a lot of people down the path of overspending, debt, and even bankruptcy. But I don’t think the problem is the credit cards themselves — it’s how we use them. And if you follow a few key rules, you can enjoy their convenience and their benefits without the financial fallout. You can start by faithfully following 10 credit card commandments. Check them out in my new post on WiseBread.
If you’re an investor, you probably have a pretty good idea of what to look for in a company. You want strong income, good cash flow, a solid balance sheet, and as little debt as possible. Those are things that not only help to create a profit, but maintain one.
Here’s a funny fact, though: Many investors fail to apply the same kind of critical eye to their own bank balances. In fact, according to the CFP Board in the U.S., Certified Financial Planners have been filing for bankruptcy in increasing numbers over the past few years. Of course, that’s true of much of the population, but we kind of expect financial pros to know better, right?
In fact, if we applied the same standards we apply to the businesses we invest in to our own bankbooks, we would all be a lot richer for it. Find out why in my new post on GoldenGirlFinance.com.
Flickr/Facing Student Loans
Many students entering university find it hard to imagine paying for their education without taking on a little debt. After all, minimum-wage paycheques just don’t go that far, especially for students who don’t get much help from their parents. As a result, about 60 percent of students take on debt, many without a sober second thought.
Maybe they see their degrees as an investment they can afford to make (or envision a lot of dollar bills in their future to help them pay the debt off). The result is that the average graduate hits the workforce about $27,000 in the red. But while student loans are easy to come by, they aren’t nearly as harmless as they seem.
Find out why student debt is a big deal in my new post on GoldenGirlFinance.com.
In 2012, 122,999 Canadians filed for bankruptcy. If you’ve never filed for bankruptcy, you might assume that these particular Canadians are not at all like you. You’d be wrong. A recent survey of more than 7,000 bankruptcy filings by bankruptcy trustees Hoyes, Michalos & Associates Inc. uncovered some key statistics about those who file for bankruptcy. The reality is that many Canadians have many of the same habits. If something unexpected were to occur to shake their financial stability, they too could let things spiral out of control.
Want to see how you compare? Check out the figures that show where many bankrupt Canadians went wrong in my new article on GoldenGirlFinance.com.
New mortgage rules that went into effect in Canada in July shortened mortgage amortizations, pushed up qualification rates and reduced the debt ratio limits for borrowers. The bottom line? Getting a mortgage got harder, especially for first-time buyers. That may be a good thing for the housing market, but it’s a real heart-breaker for those who just can’t shake the desire to own their own home. In response, some buyers and sellers are getting together on rent-to-own deals in an effort to forge an easier path to homeownership. A February report by the CBC found that new rent-to-own websites have proliferated over the past year, suggesting that the phenomenon is becoming more common. But can you really rent your way to home ownership? Find out all about rent-to-own in my new article on GoldenGirlFinance.com.
There’s a lot of credit card debt in the U.S., about $5,000 per person according to figures released by TransUnion in November 2012. As a result, what we often hear about credit cards is how bad they are for our finances. To be fair, credit cards are designed to entice consumers to spend more – and more than they can afford. If they weren’t, the credit card business just wouldn’t be profitable. That said, a credit card can be a handy financial tool when used mindfully. Get some tips to help you enjoy the convenience of credit – and keep your cash too – in my new post on Dividend.com.
Flickr/NuageDeNuit | Chiara Vitellozzi
Feeling blue? Maybe you should check your net worth. But hold on…it’s not because money makes us happier. Most studies show that once we have enough money to achieve a reasonable standard of living, more doesn’t make us much happier – and a lot more doesn’t make us any happier at all. In fact, if you’re looking for the key to greater good cheer, you won’t find it in what you own but in what you owe. Research by Lawrence Berger, an associate professor of social work at the University of Wisconsin in Madison, has found that debt and depression are twin evils – when debt goes up, so do depressive symptoms.
Now let’s just clarify a key point: This research isn’t talking about the clinical kind of depression that can drag people to dangerous lows; that requires professional intervention. Instead, Berger’s research ties debt to the day-to-day lows that plague otherwise healthy people.
Find out why debt and depression tend to go together – and what you can do to deal with both – in my new post on GoldenGirlFinance.com.
Don’t be shy, we know you have debt. Statistics Canada recently revised its numbers on Canadians’ debt levels, revealing that many of us are even deeper in debt than previously thought, owing, on average, $1.63 for every dollar we earn. Yikes!
But before we go all Suze Orman on you about how bad you’ve been, we’d like to make one thing clear: while it’s best to owe nothing at all, not all debt is entirely bad – and sometimes some debt is just plain necessary. Other types of debt, on the other hand, are nothing short of ugly in terms of the effects they can have on your financial future. So how can you tell the difference? I’ll take a look at debt – the good, the bad and the ugly – in my new article on GoldenGirlFinance.ca: http://bit.ly/Vz3F7t