This week I continue responding to your questions and comments about my book, "SAVE BIG", which is about finding savings on the big categories like houses, cars, credit, groceries and healthcare, instead of on the little stuff. I guarantee that every tip in my book has the potential to save you at least $1,000. Some readers were grateful, others skeptical. Both attitudes give me an opportunity to share more money-saving ideas with you.
Boost Your Credit Score Q: Improving a credit rating is a fine idea, but it takes a long time, so viewers/readers looking for immediate savings aren't going to find them there right away. Besides, if you already own your own home and have a good interest rate, then where are those "big" savings going to come from? ~justsane
A: It's true that most steps needed to improve your credit score involve slow and steady progress. But that doesn't mean you shouldn't do it! Sheesh! People are obsessed with instant gratification these days. I know plenty of people who skip their daily lattes to save a few dollars but let their credit go to hell and miss out on tens of thousands in savings because they can't qualify for a decent interest rate when they take out a loan. Besides, in "SAVE BIG," I also offer several pages worth of "flashy moves" that will goose your score quickly. These superficial steps should only be undertaken along with the fundamentals, but they are great strategies when you need to pick up a few points in a hurry. Things like moving your money around among your credit cards to improve your ratio of credit balance to credit limit. And lobbying creditors to report positive information about you to all three credit bureaus. Or becoming an authorized user on a family member's healthy account. If you already own your home and have a good mortgage rate, then improving your credit score will save you thousands when you refinance, take out an auto loan, or apply for a credit card.
Q: I admit that I don't always pay off my credit card and that's a problem I already acknowledge, but it's hard when the car needs new tires before winter and I don't have enough saved for it. I sometimes wonder about the incomes of people who write these articles. The average family income in my area is about $50,000 and I'm willing to bet most of these financial advisors couldn't make a realistic budget on that!
A: In "SAVE BIG" I share my own struggles with credit card debt. It is a cancer, eating away at our society. I dug myself out dollar by dollar, so I've got the chops to talk about this topic. Don't be so sure about people's incomes either. As an entry level television reporter, I only made $21,000 a year, and that was in California where the cost of living is high. And I was one of the lucky ones! Some of my fellow journalism grads at that time were only making $11,000 to $14,000 and were on food stamps.