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Liz Weston

Q&A: Credit scores and usage

July 18, 2022 By Liz Weston

Dear Liz: Thanks for your recent column about how credit scores react to heavy credit card usage. We pay our credit cards in full each month but recently we had big charges on three cards for vacations, home supplies and other purchases. I am the primary account holder on all three cards and my credit scores tanked! I even got email warnings about it from my credit monitoring service.

I have paid off two of the cards and will pay off the third one soon. My husband has one credit card in his own name that he occasionally uses and he is an authorized user on the others. I have always been the fanatical financial partner so he thinks it’s funny he has great scores and I look like a loser! Good thing we were not planning to do a house purchase or refinance the mortgage.

Answer: Pretty soon your husband will have to find something else to tease you about. Your scores are likely to return to their previous levels once the high balances are paid off and you return to your normal spending habits.

Many people are surprised by how dramatically credit scoring formulas react to the amount of available credit they’re using. But this knowledge can help you the next time you’re planning to get a major loan.

For example, you could throttle back your credit card usage starting a couple of months before your application. Alternatively, you could make weekly payments instead of monthly ones to ensure the balances reported to the credit bureaus, and used in your scores, are as low as possible.

Another approach is to pay off your balance a few days before the statement closing date, since the balance on that date is the one that’s typically reported to the bureaus. (If any charges show up after you’ve paid off the balance, you’ll need to make a second payment before the due date to avoid late fees.)

Filed Under: Credit Scoring, Q&A Tagged With: Credit Scores, credit utilization, q&a

Friday’s need-to-know money news

July 15, 2022 By Liz Weston

Today’s top story: First-time car buyers battle skimpy supply, sticker shock. Also in the news: Can student loan borrowers handle payments and inflation, 4 money moves to make before the baby arrives, and how to avoid ATM fees with these debit cards.

First-Time Car Buyers Battle Skimpy Supply, Sticker Shock
How to buy your first car when it’s the worst time to buy a car.

Can Student Loan Borrowers Handle Payments and Inflation, Too?
After nearly two and a half years of pandemic relief, federal student loan payments will restart after the pause expires Aug. 31 — unless it’s extended for the seventh time.

4 Money Moves to Make Before Baby Arrives
Adjust your budget now to account for child care expenses and any income loss during parental leave.

Avoid ATM Fees With These Debit Cards
Or use these strategies to avoid ATM fees with the debit card you already have.

Filed Under: Liz's Blog Tagged With: debit cards, first-time car buyers, inflation, student loan borrowers

Thursday’s need-to-know money news

July 14, 2022 By Liz Weston

Today’s top story: How to find an LGBTQ-Supportive financial advisor. Also in the news: A new episode of the Smart Money podcast on setting your business up for success, the debate over student loan cancellation, and which items actually got cheaper this month.

How to Find an LGBTQ-Supportive Financial Advisor
Financial advisors exist for every income level and can help LGBTQ+ people realize their goals and ensure their wishes are honored.

Smart Money Podcast: Nerdy Business: Setting Your Business Up for Success
This week, we talk with a business owner about how she turned on-the-side consulting work into a business with multiple revenue streams — and her passion for supporting other Latina entrepreneurs.

Are 0% Interest Student Loans Better Than $10K Cancellation?
Cancellation is the most popular proposal to address student loan debt, but it isn’t the only one out there.

These Items Actually Got Cheaper This Month
The new Consumer Price Index spells trouble, but not all items are affected.

Filed Under: Liz's Blog Tagged With: consumer price index, LGBT financial advisors, small business tips, Smart Money podcast, student loan forgiveness

Wednesday’s need-to-know money news

July 13, 2022 By Liz Weston

Today’s top story: Advice for renters priced out of homebuying. Also in the news: How to book a flight that (likely) won’t get canceled, U.S. drivers’ gas spending soars, and how to build generational wealth.

Advice for Renters Priced Out of Homebuying
Use a timeout from home shopping to reevaluate goals and strengthen finances.

How to Book a Flight That (Likely) Won’t Get Canceled
Airline cancellations can’t be avoided entirely, but there are smart steps you can take to prepare just in case.

U.S. Drivers’ Gas Spending Soars Toward $562 Billion in 2022
If there were a poster child for current inflation, it would be the price of gasoline.

What is generational wealth and how do you build it?
Experts shared some ways for people to begin to build generational wealth.

Filed Under: Liz's Blog Tagged With: air travel, gas costs, generational wealth, homebuying, renters

Tuesday’s need-to-know money news

July 12, 2022 By Liz Weston

Today’s top story: How the rest of 2022 might play out for homebuyers. Also in the news: How a hotel satisfaction promise has led to more discontent, 4 money moves to make before baby arrives, and when to choose miles over reward points.

‘Good deals for the bold:’ How the rest of 2022 might play out for hopeful homebuyers
Demand still exceeds supply, but the imbalance isn’t as lopsided as it was before rates went up and home sales slowed.

How a hotel satisfaction promise has led to more discontent
In the 1990s and early 2000s, hotels began offering 100% Satisfaction Guarantees to customers

4 money moves to make before baby arrives
Do them before the sleep deprivation kicks in.

When to Choose Frequent Flyer Miles Over Rewards Points
https://lifehacker.com/when-to-choose-frequent-flyer-miles-over-rewards-points-1849163378

Filed Under: Liz's Blog Tagged With: 2022 real estate, hotel satisfaction, miles vs points, pre-baby money moves

Monday’s need-to-know money news

July 11, 2022 By Liz Weston

Today’s top story: Are 4-day workweeks and flexible hours the future of full-time? Also in the news: A new episode of the Smart Money podcast on home affordability trends in the United States and abroad, what to do if you can’t out-budget inflation, and how to set your own prices for Amazon Prime Day.

Are 4-Day Workweeks, Flexible Hours the Future of Full-Time?
While a shorter week sounds appealing, there are trade-offs — and perhaps other ways to raise worker satisfaction.

Smart Money Podcast: Why Are Homes Pricey in the U.S. and Abroad?
This week’s episode is a conversation among NerdWallet’s housing Nerds who discuss home affordability trends in the United States and abroad.

What if You Can’t ‘Out-Budget’ Inflation?
Inflation is a nightmare for the many Americans who already stretch their dollars to cover basic needs.

How to Set Your Own Prices for Amazon Prime Day (and Why You Should)
Beat Amazon’s manipulation tactics by setting your own maximum prices on Prime Day.

Filed Under: Liz's Blog Tagged With: 4-day workweeks, affordabiity, Amazon Prime Dy, Budgeting, inflation, Smart Money podcast

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