Credit
No, you can check your own credit report without harming your credit score. In fact, checking your report regularly is a really good idea because this allows you to make sure there aren’t any mistakes. So, take advantage of the one free credit report you’re entitled to from each of the three major credit bureaus every year—if you stagger them, you can check your report every four months or so. You can check get your credit report by going online to www.annualcreditreport.com and ordering a report; or, by calling toll-free 877-322-8228. Remember, your credit score does not come with your credit report. You may have to pay a fee to receive your score.
Yes, when you’re applying for a job or hoping to rent a property, your potential employer or potential landlord can run your credit report—but only with your permission. And, they will not have access to your credit score, just a shortened, simplified version of your credit report. Why might they want to see your report? It is thought that information on your credit report can provide insight into your character and whether or not you’ll be reliable and responsible employee or renter.
No, not if you can avoid it! There is a myth out there that carrying a balance will help you build and maintain a good credit score. What you should do is avoid spending more than 30% of your available credit and then pay off the balance on your card in-full and on time when the bill comes each and every month. Each of those on-time payments, combined with restrained use of your credit (less than 30% of your credit limit) will help boost your credit score. The catch? If you pay off the balance too early in the month (before the bill comes) your credit report may not record that you’ve, in fact, used your credit card. So, be sure to wait for the statement to arrive, then pay off the bill on time and in-full.
No. A prepaid or debit card only lets you spend the money you load onto the card. Because both types of card only allow you to spend money you already have, they are not considered to be using credit, and your activity is not reported to the credit bureaus. There are benefits to using debit and prepaid cards—you can’t fall into debt with them and you can’t be tempted to spend money that you can’t afford to spend. But the benefit of careful use of a credit card is that building your credit opens up opportunities for future purchases, loans, lower interest rates, employment, housing, and more. Also, a word of warning: using your debit card leaves your more vulnerable because if someone steals your card information, they have direct access to your bank account.
