Andrew Harmon



Is Your Credit Score is Low Because You Want it to Be?

by Jennifer S. Matthews

Most people with low credit scores would quickly answer ďnoĒ. However, the answer is ďyesĒ for the majority of people with low scores or bad credit. Even though some readers are now riled up and/or mad after reading the first two sentences, I hope you will keep reading in search of a solution. Know this: indecision is actually a decision to do nothing.

Itís no secret how bad credit or low credit scores can tremendously hurt people and their families. However, most people do not know there are steps they can take to actively change their credit scores! I understand that some credit problems are due to medical bills and marriages that ended badly. Some people also had very affordable 30 year fixed mortgages and then had a significant reduction in income that led to late payments, short sale, or foreclosure. Yet most people do not fall into one of these situations. Instead, their low credit scores are primarily due to poor spending habits, not budgeting, a lack of an emergency savings account, and co-signing and/or providing financial support for family, friends, and significant others outside of marriage.

When it comes to family, friends, and significant others, historically African Americans often provide a tremendous amount of financial support to these groups of people. Undoubtedly, each of these groups of people holds a place of significant importance in our lives. The problem is that too many people put themselves in financial jeopardy to help others who may or may not be doing all they can to truly help themselves. Know this: if the roof over your head, utilities, and other necessities for your life are not covered, you are not in a position to financially help someone else. However, there are non-financial ways you can help people who are important to you, including researching and connecting them community resources (local government, non-profit, etc.) that can help.

Step One: Stop the bleeding! If you overspend and/or do not live on a budget, write a budget and stick with it to stop your own self-financial damage. There are numerous free resources on my website to help you, The other place to stop the bleeding is with family and friends. Be honest! Tell them that you really cannot afford to continue the financial support youíve been providing but that you will help them find resources they can follow up on to help change their own situation.

Step Two:  Make a commitment to yourself to pay your bills on time and then stick with it! Paying your bills on time is 35% of your credit score. I fully understand that you may not be in a position to pay all your bills on time right away. If thatís truly you, choose one or two bills (preferably rent/mortgage and gas/electric) and start faithfully paying them on time every month. As you tweak and get comfortable with your budget, you will start having extra money that you can use to pay additional bills on time. Once you start paying bills on time donít stop! Again, on time payment is 35% of your credit score and in about a year of consistently paying the same bills on time you will start to see your credit scores rise.

Step Three:  Look for ways to cut your expenses, which is the premise of my book. How can you cut your utility, cell phone, and cable bills? Most people who do a little digging and research can lower these bills by a total $100 - $150 each month! Then, each month put half the money created into an emergency savings account and use the other half to start paying an additional bill on time.

This is just a start and itís admittedly harder to change bad spending habits that it is to continue the status quo. If you can get these three steps under control there are more steps you can take to accelerate increasing your credit scores. The most important thing is to get started!

A quick story about me: Iím quickly approaching the magical age of 50. About six months ago, I decided to get braces and straighten my teeth for purely cosmetic reasons. Thatís not a common step to take at my age, and Iíll wear them for about 2 years. Looking ahead, two years will surely come and go. I could do nothing and still have crooked teeth in two years, or I could take action and have straight teeth two years from now.

Along the same lines, you can commit to making some hard decisions and taking some tough steps now so that youíre not as financially stressed two years from now, or you can keep doing what youíve been doing and still be in your same current financial position, or possibly even worse, in two years. If your credit scores are low and you choose not to start working toward making a difference such as with these three steps, then the article title applies to you and the decisions you have made regarding your credit scores. Remember: indecision is actually a decision to do nothing.

About the Author: Jennifer S. Matthews is an award-winning author, motivational speaker, and is trained as a financial coach. Her award-winning book 12 Ways to Put Money in Your Pocket Every Month Without A Part Time Job, was also nominated for a 2013 NAACP Image Award. The book shows readers how to create hundreds of dollars in cash every month from within their existing income. Visit Jennifer online at and sign up for her newsletter. You can also purchase her book, take advantage of free downloads, and much more.

© 2014 Creating Financial Literacy, LLC


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