Credit scores affect the financial lives of millions of Americans. A low credit score can lead to higher interest rates on loans, difficulty getting a loan for a home or car, and even denial of employment. If you're overwhelmed and frustrated at all the ...
‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ 

Here's the Latest from FunHappyHome.com "How to Raise Your Credit Score 100 Points in 5 Steps" plus more




How to Raise Your Credit Score 100 Points in 5 Steps

Credit scores affect the financial lives of millions of Americans. A low credit score can lead to higher interest rates on loans, difficulty getting a loan for a home or car, and even denial of employment.

If you’re overwhelmed and frustrated at all the advice you’ve been reading online – or getting from well-meaning friends and family members – and you desperately need to raise your credit score, this is for you!

If you’re wanting to raise your credit score…whether it’s a few points or 100 points or more, we’re going to give you 5 steps to follow. The truth is, building credit is simple, but we often overcomplicate it.

Check out these five steps to raising your score.

Raise Your Credit Score 100 Points in 5 Easy Steps

If you’ve ever tried to finance a car or a house, you know that your credit score matters…and it matters big time. The higher your credit score, the more likely you are to qualify for a lower interest rate and get better deals on the things you’re financing.

And while that’s all good and well, when your credit score stinks, it can feel hopeless and frustrating. There are so many financial “gurus” out there with differing advice that it can make it hard to know what to believe and who to follow.

With all the credit score talk on the internet, it’s easy to understand why people get confused about credit. Raising your credit score can be a frustrating process, especially if you don’t understand where you’re starting or where you’re going! 

Know where you’re at.

The first step to improving your credit score is to know what your credit score actually is. I feel like personal finance is one of those areas of life where we often stick our heads in the sand because we’re afraid of knowing the how bad things really are. Just like it’s important to know your numbers when you’re paying off debt, it’s also important to know your numbers where you’re trying to improve your credit score.

Using a site like Credit Karma is fine if you want to see how much your credit is improving at a glance, but if you have serious goals…like buying a house or car, you’ll need a more accurate number. 

Did you know you can get a free copy of your credit report once a year from annualcreditreport.com? It’s totally worthwhile and something that you should do yearly. It’s a great way to gauge the progress you’re making and it’s also a great way to catch identity theft early.

I know it may seem impossible, but you can get your credit score to over 800…even if your score is currently in the low 400s. Even if your credit score is currently abysmal, you can raise your credit score to 750 or even 800+ in a year.

While a year may seem like a long time, in the whole scheme of things, a year really isn’t that long. If you decide to focus and are willing to make a few sacrifices, you can dramatically change your credit score in the next 2 years. And that change can radically impact your life!

Know where you’re going

If you want to improve your credit score, you need to set a specific goal. Do you want your credit score to be 750? Are you shooting for 800? Whatever that goal is, write it down and put it somewhere you can see it regularly. Add it to your dream board, vision board, or even to your phone wallpaper. I’m a big believer in putting your vision in front of you!

If your goal is an increase of 100 points or less, you should be able to accomplish it in well under a year. If you have several collections on your credit that you’re currently unable to pay off, it may take longer. The good news is, you may be able to get some of those collections removed.

Write letters and call people!

One of the best things you can do to improve your credit score is to reach out to the major credit bureaus and request your collections accounts be deleted. You should also write letters to the companies you owe money to.

Did you know that you can often request pay-off accounts from the collection companies you owe money to? Many of them will allow you to pay half of what you owe…and sometimes even less depending on the circumstances. Make sure that you have them agree in writing to remove the collections from your account once you have made your payments.

Another trick you can utilize is heading to experian.com/boost and linking your bank account. Most of the time people get an instant credit boost simply for proving they pay their utility bills every month. The best part? Experian doesn’t report negatively if they see you missed making a payment. Hooray for tools that will only help boost your score.

And while a boost of 20 points may not seems like a big deal, using little tips and tricks like this along your credit journey will definitely add up.

Pay your bills.

This may make you roll your eyes at me, but from now on you need to pay all your bills on time – every single month. If you need to set them on auto-pay, do that. A single late payment can drop your credit score by more than 40 points!

If you’re struggling financially, read my other blog posts about building an emergency fund and starting a side hustle. Who knows? Your side hustle may turn into a full-time income stream!

While this may seem obvious, the more you make, the faster you can pay off your debt. And the faster you pay off debt, the more you’ll save in interest and other fees, so do what you can to bring in extra income!

Don’t be afraid of credit cards

I know that many financial gurus tell you to avoid credit cards and for some people they can be a dreadful mistake. But signing up for credit cards while you’re repairing and building your credit can be helpful. If you struggle with overspending, you may not be ready for this step. Consider getting a secured credit card if you’re not sure if you’re disciplined enough to not spend more than you have. 

If you’re serious about building your credit and becoming financially secure, overspending on a credit card won’t be tempting. Consider using it for a cheap recurring subscription each month like Disney+ or Netflix and pay the balance every single month. If you’re afraid you’ll be tempted to use it on other things, keep the card at home in your safe or give it to your spouse to hold on to. 🙂 Whether you like the idea of credit or not, utilizing credit in a responsible way is one of the easiest ways to raise your credit so you can eventually buy a home. 

If you started with a secured card, but feel like you’re ready for something more, do your research. While sites like Credit Karma will offer you suggestions that they say will be a good fit for you, they’re not always in your best interest since Credit Karma earns money for referrals. Look for credit cards that don’t have a yearly fee and find ones that will give you airline miles or reward points. Use it to pay one or two bills each month and you’ll be able to earn airline miles while you’re improving your credit! Win-Win!

I can’t stress this enough…if you’re worried about being irresponsible with your credit card, set it up for ONE monthly subscription payment, then cut up that card. Make sure you’ve set up auto-pay so that your bank automatically pays your credit card each month. By doing this, you aren’t spending more money, you are just spending it differently – and earning points and building credit in the process.

Once you get accustomed to responsibly using your credit card, start paying most or all of your bills with a card that collect points or airline miles. Some cards even offer cash back rewards, which means that not only are you building your credit, but you’re also saving money which can be used for something special down the road.

The sooner you get started in improving your credit, the sooner you’ll start seeing improvement. And while every credit situation is different, you can use these helpful tips to get you started and moving in the right direction! Before you know it, you’ll have the credit score you put on your vision board!

Pin These Tips for Raising Your Credit Score

      

How To Build An Emergency Fund Fast

You never know when an emergency will strike. It could be a car accident, medical bills, or some other unforeseen event that leaves you in dire straits. In order to protect yourself from the unexpected and prevent your finances from spiraling out of control, it’s vital that you have an emergency fund. While building up an emergency fund can seem daunting at first…especially if you’re living paycheck-to-paycheck, it is totally doable and we’re here to help you!

Building an emergency fund is critical for financial security and, more importantly, peace of mind. Many Americans admit to struggling with anxiety because of financial stressors at home. While an emergency fund won’t solve all of your financial problems, there is peace of mind in having an emergency fund.

3 Steps To Build An Emergency Fund Quickly

When you’re trying to get your finances in order, everyone talks about getting out of debt, buying a house, and building an emergency fund. Whether your emergency fund is a “baby” fund at $1,000 (the bare minimum) or you have 6 months of expenses saved, evaluating where you’re at and setting goals will help you achieve them much faster.

Evaluate where you’re at.

You can’t move forward unless you know where the starting line is. The baseline is where you’re at right now. Remember this is a starting point! This isn’t the time to get fancy and try to make your finances look better than what they are.

Start with an evaluation, and be brutally honest with yourself. If you’re spending way too much money on fast food or makeup, don’t beat yourself up over it – just fix it.

In order to do a thorough evaluation, you will need to go through all of your accounts and look at how much money you have and what you’re spending your money on. Check your bank account, PayPal, CashApp, etc. This includes prepaid debit cards or any other accounts you may stash money and spend money from.

What does your money situation look like? Have you been spending more than you make or is your income higher than your expenses? Do you have extra money each week or each month? How much extra do you have? Write all these numbers down, as they’re equally important in figuring out where you’re at, and fixing the leaks. We’ll talk about that in a moment.

I like to print off my bank statements and go through everything line by line to see where my money is going. You can print 1, 3, 6, or even 12 months off at a time. It all depends on how in-depth you want this financial audit to be.

Fix the leaks.

After I’ve printed off my bank statements, I go through them with highlighters. I highlight necessary expenses in one color. These are things like rent or mortgage, utility bills, and groceries. Then I highlight all the unnecessary expenses in another color. These might be dinners out, online shopping purchases, a gym membership you’re not using, a subscription that you don’t need. I also use one more color to highlight my questionable expenses. These are things I think I need (or things I just really want that I’ll try to keep in the budget). You’ll probably find that going line by line through your entire bank statement (and PayPal, Venmo and CashApp) is very eye opening!

Is Starbucks a regular line item in your bank statement? How often do you go through the drive-thru? How much did you spend on your last date night? How many last-minute trips did you have to make to the grocery store because you didn’t have a meal plan? How many times did you buy soda or snacks from the machine at work?

I like to call all of my unnecessary expenses “leaks”. If you want your boat in tip-top shape, you need to fix all the leaks! I love the way Benjamin Franklin sums up my thought so well, “Beware of little expenses; a small leak will sink a great ship.” OK…so maybe he’s the reason I like the term leaks so much!

Budget leaks are going to be different for everyone! It’s super helpful to take the time to figure out what yours are. While going through your bank statements, the leaks will usually become clear pretty quickly!

Many of us have expenses every week, or sometimes even every day, that we don’t consciously take into account when evaluating our financial situation. They may be small purchases that are less than $5 or $10 each, but they tend to add up quickly. Those tiny leaks that you don’t even think about are often most dangerous ones, because you don’t even realize you have them!

It doesn’t matter how much money you make or how small you think the leaks seem…you have to fix the leaks!!! If you add up all the “little” leaks over a 6 or 12 month period, you’re going to notice your boat is sinking much faster than you may have realized. No matter what, the leaks need to be patched, right? Small or large, they’ll still cause problems.

Before you send me hatemail, let me tell you that you don’t need to cut all unnecessary expenses over night. For example, if you’re used to going to Starbucks every morning, you don’t have to quit cold turkey. Buy coffee to make at home and see how close you can get it to what you’re used to. If you’re into fancy Starbucks drinks, see if you can find a Starbucks copycat to make at home.

You may realize you like the coffee you make at home even more than the stuff you get at the coffee shop. When my husband made the switch, someone suggested that the quality and freshness of his coffee beans would make all the difference in how his coffee tasted. My husband started buying freshly roasted coffee beans for his cups of coffee at home and he determined they were so much better than what he got at the coffee store. He now even roasts his own coffee beans at home. By ditching his “fancy coffee” habit, we save over $1000 a year. Crazy, right!

You can use the “leak” money to put towards your emergency fund, but I would be remiss if I didn’t also talk about adding extra income to your budget! Even if you make a large income, this can be beneficial in helping you get to where you need to be quickly!

Make more money.

Building an emergency fund comes down to a simple principle: spend less money than you make. Or you can look at it like this: more money in, less money out. If your income isn’t already covering your bills with some left over to add to your emergency fund, you need to make some changes. The good news is, these changes don’t have to be painful. The bad news? You’re not going to build your emergency fund overnight.

There are hundreds of ways to make extra money to build your emergency fund faster. I’m a huge fan of the side hustle and always have at least one or two going at any time. I’ve been a Color Street stylist for 3 years and love that I can make money just by talking about my fabulous manicures. You could start a blog as a semi-passive long-term income stream, or you could deliver for UberEats after your 9 to 5 job is over. Whatever you choose to do, just know that the amount of extra income you can earn from side hustles is endless. 

Even if you can cut your expenses to next to nothing, you’ll most likely still need more income. YouTube is a wealth of information, complete with full videos about how people just like you and me became millionaires because of their side hustles. While the millionaire life isn’t everyone’s goal, you can easily make an extra thousand dollars a month (or more!) with side hustles. And for some people, an extra thousand dollars monthly is life-changing income!

The next steps…

One of my favorite quotes is a quote by Arthur Ashe that says “Start where you are. Use what you have. Do what you can.” and I think this is sooo applicable when it comes to personal finance. This is your PERSONAL journey. That’s why they call it PERSONAL finance.

No matter how intense you are with fixing your financial leaks or making more money with a side hustle, your journey is your own. There are going to be detours and setbacks. Life happens, things get in the way, and paying off debt can be painstakingly slow. However, you’re on the right path and you CAN do this! Keep reminding yourself of that! Negative self-talk can set you back even more, so keep it positive.

Do you have an emergency fund or a plan to start one? Leave me a comment!

Pin How To Build An Emergency Fund Fast for Later!

      

How To Pay Off Debt Fast

There are few things that are worse than that feeling you get when you know you’re drowning in debt. Believe me, I know. I’ve been there! Today I want to show you how to pay off debt…and pay off debt fast!

Most people get into debt because they are living paycheck to paycheck and don’t have an emergency fund. They make the minimum payments each month and spend everything else on things that they want. The end result is a pile of debt that will take years to pay off, if ever! This blog post contains six proven strategies for paying off your debts fast so you can live without the stress of owing money!

If your finances are a hot mess, it can be incredibly overwhelming to think about becoming debt-free. I’ll be honest with you. Learning how to pay off debt fast isn’t for the faint of heart. If you’re looking for some “get rich quick, pay off debt quick” scheme, you’ve come to the wrong place. Becoming debt free will take some hard work and some sacrifices on your part.

How To Pay Off Debt Fast

Know what you owe. 

Unhappy couple on a sofa in the living room

If you’re ready to get serious about debt, you need to pull your head out of the sand and figure out exactly how much you owe. There is power in knowing that big scary number.  If you’re unsure how much debt you have, you will never be able to confidently say you’ve paid it all off. Make a list of all of your debts.

When my husband and I first faced our debt, we had over $80,000 of debt. It was a ridiculous number, but with hard work and attention to detail, we were able to get it paid off.

One of the things that is helpful in knowing what you owe is to get a free copy of your credit report from annualcreditreport.com. If you’re wanting to know that all of your debt is going to be paid, you will want to request a credit report from all three before you start working to pay off debt. Once a year, you can request your credit report from all three agencies.

Set a debt-free goal date

A goal without a plan is just a wish. Quote Set a deadline to pay off debt fast.

A goal without a plan is just a wish. Focusing your efforts on debt repayment without setting a goal date may work for some people, but it will likely not be enough to help you get out of debt.

Before you begin, look at how much debt you have total. If you owe $10,000, set a goal of paying off $1,000 first. Of course you will want to pay the entire $10,000 off as quickly as possible, because interest rates are terrible! That high of a goal can get overwhelming quickly. 

Breaking your goals down into more manageable steps will help you create the “snowball” effect that is so popular when paying off debt. If $1,000 is still too much to reach for at once, start with $100. No amount is too small! The only person you’re competing with is yourself.

Setting a debt-free goal date includes basic budgeting. How much can you truly afford to put towards your debts each week? Giving yourself a deadline creates a sense of urgency, use that as motivation to stay on track! Remember to make your goal challenging, but realistic, so it won’t cause too much financial stress in the process!

After you set your mini goal, set a goal date. If your goal is $100 and you know you have an extra $50 a week you can save, set your goal date about 2 weeks out. You want to be ambitious without being unrealistic. Without deadlines, there’s way too much room for slacking.

Reduce all possible expenses 

To prepare you for your journey to becoming debt-free, begin reducing as many of your expenses as possible. This is especially important if you don’t have a bunch of extra income to put towards your debt each month. This is where sacrifices and strict budgeting come into play. 

Make your morning coffee at home, try to eliminate money spent on fast food (or at least reduce how often you go out for fast food), and call to see if your bills for things like the internet, cable, car insurance, etc. can be lowered.

This phase – especially cutting out extra shopping and fast food – may be difficult at first. The longer you stick with it, the easier it gets.

Reach out to creditors 

It is not common knowledge that some creditors will actually negotiate the total amount of your debt with you, but they do it all the time. Use this secret to your advantage! These negotiations can often result in you owing much less than you started with. 

The only way to see if a creditor is willing to negotiate is to contact them.

One thing to keep in mind when reaching out to creditors is that they will now have your phone number. You’ll most likely by inundated with collection calls!

Use the Debt Snowball Method 

The Debt Snowball Method of repaying debt was popularized by financial guru Dave Ramsey and, even if you’re not a fan of his personally, this method is still one of the best ways to pay off debt. When we were up to our eyeballs in debt, we started our journey by reading The Total Money Makeover. This was a game-changer for us.

I love this process because it’s easy to understand and easy to gain momentum with. You begin paying off debt by paying down the smallest debt owed. You don’t need to worry about interest rates or anything else. Just take your smallest balance and pay it down aggressively while making sure to continue to make the minimum payments on your other debts.

Once it is fully paid, you then move onto the next smallest balance, making sure to roll the money you were paying monthly on your recently paid off balance into the monthly payment of your new goal. Over time, you will be paying off debts with high monthly payments and not suffering too much because of it, due to the rolling over of previous payments.

Make the most of every penny

Jar filled with pennies Every penny is important when you are paying off debt!

When you’re trying to pay off debt fast, you can’t be stingy with the money you use to pay your total debt down. In other words, every penny of extra money you have should go toward your debt repayment campaign until you are totally debt-free. If this means that you can’t afford other things now, don’t worry: in a short time, your higher-priority goals will be achieved and all of those things that seemed so important before won’t seem like such luxuries anymore.

One sneaky, painless way to use every penny is to set your bank to round up all of your purchases to the next dollar. This means if you purchase groceries and the total was $103.45, you will have $.55 rounded up and put into another savings or checking account. Then, use the funds from that account to pay extra on your debts. 

Don’t forget that you can always pick up a side hustle to help bring in extra cash. The extra effort may be worth it if you’re really trying to become debt-free as fast as you possibly can. 

Track your progress 

Using a debt payment tracker can help you pay off debt fast and keep you motivated when you're struggling!

It may sound like common sense, but this is still worth mentioning. Keeping a debt payment tracker on hand can be a very big motivator for when you get burned out and tired of the work involved. It can really help you keep pushing when you feel like giving up to see how far you’ve come. 

Your debt tracker can be as extensive or as simple as you want it to be. For some, planners with graphs and boards work well. For others, a simple blank thermometer on the wall is the best option. Whatever you choose, make sure you keep it in a place that you’ll see it often to keep that motivation rolling. Remember along the way that every payment you make is one step closer to being completely debt-free! 

Remember this is a journey

Paying off debt can be tedious, time consuming and at times even heartbreaking. You will find yourself jealous of friends who are “living the life” because they’re not worried about their debt. You may even find yourself wanting to quit or simply angry at the fact that you’re in debt in the first place.

In the end, if you do find yourself feeling any of those negative emotions, remind yourself that it is one-hundred percent normal to feel this way on any hard journey. Then refocus…and move forward!

In the long run, you’ll be so glad that you pushed yourself in order to become debt-free. As Dave Ramsey says so often, “Live like no one else, so later you can live like no one else.” In other words, make the sacrifices and do without now so that later you can live a life of financial freedom and abundance.

Pin These How To Pay Off Debt Fast Tips for Later!

Use the tips to pay off debt fast picture shows a piggy bank with change and cash