Ever wondered, “Hey, does my credit score actually matter? Do I really need to care about it? Or is it just another number the world has cooked up?”
Well, you're in luck! In this fun and informative episode, we explore the significance of your credit score and the various reasons behind its importance.
From lending and financing to landing that dream job, we delve into how credit scores can impact different aspects of your life.
Spoiler alert: It really does depend… But don't worry, we'll explain why!
Every Tuesday, Tiffany answers one of your submitted questions. To submit a question for an upcoming episode, visit here: https://www.moneytalkwitht.com/asktiffany
- Credit score matters if one is looking for lending, financing or even a job; as employers may pull credit reports/scores.
- Insurance companies also use credit scores to determine rates.
- If one has all the stuff they need and isn't looking for financing or debt, then the credit score isn't too important.
- However, it's wise to maintain one's credit score anyway, as one never knows what they might need or want in the future.
Intro/Outro: You know what it is. That's right. It's time to talk money with your money nerd and financial coach. Now tighten those purse strings and open those ears. It's the Money Talk with Tiff podcast.
Tiffany Grant: Hey, hey, this is Tiffany's Take where I answer your money questions. If you want your question answered on the podcast, go to www.moneytalkwitht.com/tiffany. So the question today, How much does my credit score really matters? So I assume that this person's asking like, do I really need to care about a credit score?
Like, is this really as important as other people may get out to seem? You know, so on and so forth. And I will tell you that. It depends. Okay. And I know you all are probably like Tiffany, you say it depends a lot, but it really does. So let me tell you some reasons why a credit score would matter. So a credit score would matter if you're looking for, um, lending, if you're looking to finance something, um, even.
A lot of times for jobs, jobs will pull your credit report and pull your credit score, um, to see if they should employ you, um, as part of your, um, evaluation package. So it just depends on what you're trying to accomplish. Also, your insurance company. Might use your credit score to figure out what rates they need to charge you.
Your credit score gets used in a lot of different ways that people don't really think about. And so if any of those things are important to you, then of course, yes, your credit score does matter. Now, let me give you some instances. Um, well first, let me just dive into those first. Okay, so when you're thinking about getting a.
Part of what employers can and will do, cuz I've seen it happen, is they will pull your credit score. And this is especially important if you're in like a finance industry or something dealing with money. They wanna make sure that you are trustworthy with your money. You're not dealing with any, you know, extensive debt, you know, things like that because then that gives you more incentive and I'm doing air quotes to steal, um, from the company.
And so, That's kind of why they take credit scores into consideration to see, you know, how so responsible you've been in the past with your money. Uh, also when I talk about insurance rates, I have learned this probably a few years ago when I was dealing with my credit scores and stuff and I was talking to an insurance agent and they were like, oh yeah, your credit.
Does play a role in this, your credit score. And I said, what? Like, I had no idea. So that's why when you talk to people and you're comparing notes on, you know, how much are you paying for insurance, how much are you paying? It can vary so widely because it's based on so many different things with your credit score being one of them.
So I just thought that was really, really interesting. And then also, you know, if you're going for lending, Uh, and when I say lending, I mean going for a car and you need to get it financed, a house, you need to get it financed, all that type of stuff. Then of course, you're gonna have to pay attention to your credit score because that is what lenders use.
It's very difficult. I mean, it's not impossible, but it's difficult to find like a hard money lender where they don't look at your credit score. Um, but I have not seen that too much, and even if. You know, listen to Dave Ramsey or what have you, cuz he's one of those where he is like, oh, you don't need a credit score, make it zero, da da da da da.
But I'm like, yeah, that's all fine and dandy if you already have everything. If you don't need to finance anything, then cool, because otherwise you're just gonna make your life difficult. Um, so anyway, those are some reasons why you would want. A credit score and why it's important. Um, now let's get into when it's not really important, and that is when you already have all that stuff.
So if you already have a house, you already have a car, you know you're not looking for financing for anything and you don't think you will be using it in the future, then a credit score is kind of like a moot point. The main reason a credit score exists is for you to get financing and things like that.
So if you are already able to cash flow everything, you don't really need lenders, you don't really need debt for anything, then a credit score becomes less important. And I mean, If you take into consideration like maybe you are already in a job, you know you're gonna be there forever, um, you already have an insurance company that you really, really love, they already give you good rates, you know, then the credit score becomes less and less important.
Now, I would argue to say it's good to just make sure you keep it up anyway, even if you are in that situation, just because you never know. You never know what you might need. You never know my, what you might want. And at the end of the day, why not leave all your options open? You know, so that's just kind of my take on is a credit score important and hopefully that helps you in making whatever decision you're trying to make, um, whether it's to work on your credit or.
Maybe even not worry about it too much, you know, whatever decision it is that you're trying to make. I hope that was helpful for you. If you would like your question answered on the Money Talk with Tiff podcast, you can go to www.moneytalkwitht.com/tiffany and I will be more than happy to answer for you.
Well, until next time, I'll see you next week. Bye. Thank
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Until next time, spend wise by spending less than you make a word to the. Is always sufficient.