Credit Repair + Debt Elimination = 800+ FICO® Score Credit Report

Debt, Credit Rating, Credit Repair, FICO® Credit Scores, and Saving Money

At some stage of your credit repair and debt elimination, you will want to begin saving money to cover costs that will be occurring in the future; however, until you have paid off your debt that is costing you money in interest and penalties, it is not wise to save money.

You need to reduce and eliminate your debt thereby cutting off the drain on your income that is required to cover the interest associated with the debt; and by doing so you will be gaining a lot more benefit than trying to build up a surplus of funds in your savings account.

You will always earn less money from the interest of funds invested than it will be costing you for the interest you are paying on your debts.

Because of this, if you were to save money and not pay off debts it would be a backward step as it is in effect costing you the difference between the after-tax interest you could be earning on your investment money and the full amount of interest that you are paying on your debt.

In addition to paying interest on your debt, often you will be missing out on discounts for early payment of accounts and this is an additional ’saving’ in effect that you will be losing out on, by not making payments on time.

The best action you can always take is to reduce debt where possible unless that debt is associated with an income earning asset or something that you will make a capital gain on over and above the expenditure that you have to make on the interest by having that debt.

Once you have cleared all your debt then you can start thinking about making savings but it is not a good business decision to do that before the due time even though it might make you feel good.

Eliminate your most costly debts first, the rest of your debts second and then start saving your excess funds when all debt has been taken care of.  Your credit rating, FICO® credit score, and credit report will also begin to rise without fail.

Dr. Robert Miller, Ph.D.
Investigations Analyst
www.TheCreditRobbers.com

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Credit Repair + Debt Elimination = 800+ FICO® Score Credit Report

Debt, Credit Rating, Credit Repair, FICO® Credit Scores, and Limiting Luxuries

There is a big difference between wants and needs and when you are faced with excess debt and debt elimination, then the only thing you really need to focus on are your needs and how you are going to pay for them.

You don’t need to own the latest wide screen television or an X-Box or PlayStation. If you’ve got overwhelming debt, then one of the first things you need to do is start limiting luxuries and maintaining and start improving your credit rating, FICO® credit score, and credit report.

Now this doesn’t mean you are going to downgrade your lifestyle at all, because along with all these luxuries that you’ve been purchasing, your lifestyle has been downgraded considerably with the increased stress and financial burden you are faced with every day directly related to your credit rating, FICO® credit score, and credit report.

Now consider how much happier you would be if you didn’t have to pay back all that debt and worry about debt elimination and debt recovery.  Consider how much happier you would be if you didn’t have to think about how you are going to pay the food bill at the end of the week.

Once you start putting these factors into perspective, you can see how the purchase of luxuries that might possibly give you a few moments of pleasure have added considerable  stress and strain to your lifestyle and have actually limited the things that you can do on a daily basis.

Wouldn’t you like to trade in some of those appliances that you never use for less stress and more time to get out and enjoy yourself? Wouldn’t you like to trade them in with a chance to take a short holiday away from the debt worry?

Now is the best time for you to start looking at these luxuries and consider the benefits they have given you and the downside that you are living with.

When in debt, you must limit or eliminate your luxuries and those that you have and don’t need - cash up and use the money to pay off some of your debt. You will be a lot happier in the long-term. 

Bottom Line:  Your credit rating, FICO® credit score, and credit report will have a negative impact if you do not limit your luxuries.

Dr. Robert Miller, Ph.D.
Investigations Analyst
www.TheCreditRobbers.com

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