2014 Credit Management Review

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One of your most important assets is your credit score. Your credit score such a powerful tool because it can give you access to loans to finance cars, homes, and open credit cards and at low rates. Just knowing your score is half the battle, and trying to improve it is the other part. In my case, I've been building credit since I was 20 with my first credit card being a $500 limit student credit card. Sure, it wasn't much but even then I was earning 1% cash rebate on my purchases and was able to have credit start working for me! In 2010 I started aggressively applying for credit cards in order to get many credit card sign up bonuses to fund free travel and even get cash rewards. Since I've been pursuing my credit card strategy of applying for 3-6 credit cards a year, I've earned an estimated $8,000 in credit card rewards not even including the amount earned from spending on the cards. 

I'm able to do this because I believe in being responsible with credit and I'm exteremely detailed in monitoring all of my credit cards in order to pay NO interest, penalties, or other fees. I have always paid my balances in full and on time every month. I take pride in having a spotless credit report and love seeing the benefits of having my score increase and continuing to earn credit card rewards. 

One of my favorite tools for tracking my credit activity is CreditKarma.com. I've been using CK since 2009 and as you can see I started with a credit score of 695 and have increased it to 760 at the end of 2014. 

There are plenty of other credit monitoring tools out there but, none as comprehensive and FREE like CreditKarma. I also use CreditSesame.com, Quizzle.com, Credit.com, and have access to various scores and tools from my credit card companies such as Capital One Credit Tracker. I used to use annualcreditreport.com, however, I haven't checked one of my free credit reports in over a year. Unfortunately, when you get one of your free reports it does not come with your FREE score. The credit buerea will usually try and sell you a product to get your free score, however, I don't think that it necessary when there are so many free tools out there. I've never spent $1 on credit reporting or credit monitoring services. I've also have never had any ID theft situations, and in the event that I did, I might consider a paid monitoring service. 

Obtaining credit can be a Catch 22 type situation. If you have no credit, then people are less likely to give you credit, but in order to build your credit you need to start sometime. One of the things that really helped me was that my mom added me as an authorized user to a couple gasoline credit cards when I was only 13, before I could even drive. Since she was responsible with credit and always paid her bill on time, I benefited. Although I don't use those gas cards today since I buy my own gas, those accounts are still on my credit report and have helped me show a long credit history with the burueas. 

2014 was a pretty busy year in terms of credit:

  • I was approved for 8 credit cards, getting me 365,000 rewards points from sign up bonuses, 2 FREE Nights at Hyatt Hotels, and over $4K in value when redeemed for travel expenses. I did have to pay 3 annual fees on cards totaling $224. Small price to pay for so much value!
  • I closed 7 credit cards to avoid annual fees or free up some available credit at banks I planned on applying for new cards with
  • I started with $109,200, added $86,000, removed $63,000 and ended with $132,200 in total credit limits (personal and business cards)
  • My score started at 764 and decreased 4 points to 760.
  • I was approved for a new mortgage decreasing my interest rate from 5.0% to 4.125%
  • I ended the year with an overall grade of an A and have Excellent Credit

Outlook for 2015

I anticipate my score staying about the same in 2015. I will have some some credit inquires knock off my report but I also expect to apply for around 3-6 credit cards during the year to fund travel with the credit card bonuses. I don't expect to refinance nor apply for any new loans.