Image by: Natloans via Flickr

Living with a low credit rating can be worrisome and render you ineligible for loans and credit cards without a high interest rate attached. While it’s not the best thing to have a low credit score, it’s not impossible to repair your rating- if you’re willing to work at it. Consider these easy tips for improving your credit rating.

Credit cards

There are a few options with credit cards in terms of raising your credit score. First, if you already have a credit card, try your best to pay it off in full every month. If you’re not able to do this, at least make the minimum payments on time. This will show that you are aware of your debts and making an effort to pay them off.

If you don’t have a credit card, consider applying for one. Make small purchases on this card and be diligent in paying it off in full. Taking out a credit card and not ever using it will not help your credit score. They want to know you can borrow money and pay it back responsibly.

If you are currently paying off a credit card, you can still consider taking out a second card. This is risky if you are an impulse shopper! ONLY take this step if you are sure you can be diligent in using this card only for small purchases and be sure to pay it off on time every month. If you are serious about raising your score, you have to be serious about not over-spending.

Also, keep in mind that it’s not the best idea to max out your credit cards or, conversely, to cancel one. These events raise flags in your credit score, even if you have paid off the balance completely.

Debt

If you are already swimming in debt and it’s affecting your credit score negatively, it’s a good idea to make a payment plan and stick to it. Even if you are just slowly digging away at your debt, an organised and consistent payment plan will reflect positively on your credit score (though it won’t fix it completely, it’s a good first step!)

Loans

Taking out a manageable personal loan that you can easily pay off will also help boost your credit score. Unlike a credit card, you don’t necessarily have to spend the money you get from the loan- just be sure to pay it off with monthly payments.

It’s always a good idea to pay your bills- all of them- on time and in full. Also, keep an eye on your credit score. It is a reflection of your spending and financial habits and the information is available to you. It’s better to know now than be surprised later.

Do you have any credit-score-raising tips? Tell us about them in the comments below.

How many germs do you think are lurking on these coins?, Source: live w mcs - multiple chemical sensitivity, Flickr

There are a lot of urban myths about money that you might not realise, as well as a lot of things that are true about money that you think are just old wives tales. Cashzilla is going to give you some fact or fiction answers to some of the most commonly mistaken statements surrounding money, take a look at the list below.

Money is covered in germs

FACT. A recent study in the Netherlands showed that coins contain more than 1000 bacteria on the surface of the metal, as well as notes containing a staggered few million. However, before you develop an instant fear of touching money; keep in mind that your hands are home to millions of bacteria, fungi and viruses that will take more than just a hand sanitiser to remove!

Your address will affect your credit rating

FICTION. A common myth about money and lending is that if the previous tenants of your property had a lot of debt sitting at your address, that this will put your own credit rating at risk. However according to global money expert Experian, this is untrue. Experian say that the financial status of the previous owner will have no influence over lenders decisions.

Torn Money, Source: Images_Of_Money, Flickr

The bank will replace destroyed money

FACT. Many people are under the assumption that if your money is destroyed by being ripped, torn, soaked etc, that it therefore becomes obsolete. This however, is untrue. Most banks will agree to replace your dismembered currency as long as at least half of the note is still available to be inspected. Another belief is that the bank will only replace the note to half of the original value i.e. a torn £20 note would be replaced by a fresh £10, this is untrue also as many banks are willing to give you back the same value as long as they are able to identify how much that was. Although, even though banks are more than willing to co-operate with you in this situation, the same can’t be said of shops, who are more than within their rights to refuse the broken tender.

Renting property is throwing money away

FICTION. You often hear people stating that by renting your property instead of buying it is a waste of your hard-earned money but it is actually just a negative way of looking at things. You need to consider the money you pay out for rent every month in the same terms as the money you pay out on your food and bills too. Both food and bills are expenses for items which you purchase regularly, that then get used up and you are left with nothing to show from that spend. These things are necessary requirements for spending if you want to live comfortably and in today’s economic climate, buying might even be considered more of a waste than buying due to fluctuating house prices and the interest on mortgages that you will be inevitably throwing away too.

You get what you pay for

FICTION. It has always been a common conception that you get what pay pay; the less money you pay the poorer quality that item will be and vice versa. This is in fact not always true of course. If you think about medication for example, retailers are not allowed to sell you drugs that won’t do as they say on the tin for obvious health reasons so buy buying a supermarket’s own brand of paracetamol compared to buying a major brand’s paracetamol will really make no difference to you whatsoever, they are both going to cure you of your pain.

What difference does the brand make? It still does the same job right? Source: drhenkenstein, Flickr

So with these common misconceptions of money fact or fiction have been cleared up, you can now let go of some silly old wives tales and realise your money mistakes also! To finish off, here are 3 fun money facts that you might not have realised before:

• through the nose” came from an old Irish act that happened in the 9th century (AD) which involved the gruesome slicing of noses belonging to the people who didn’t cough up the money for their taxes. Ouch.
• Money was once made of leather, however after some experimenting with other materials, the Chinese started using paper money in 806. It wasn’t until centuries later in 1855 that Europe caught onto this new money tender. Little slow on the uptake eh Europe?!
• Finally, the Bank of England is has a few, very rare £1 million notes circulating in their bank, although it is unlikely that you will ever see them as they are only ever used internally within the bank.

Tell us about some money facts or fiction that you want to set straight in the comment box below.

I was a student for 6 years and have had 13 different addresses over the past 8 years. From time to time I had bills in my name, from which i am sure there may be late payment records. I have exhausted all savings and currently have approximately 11,000 of student loans outstanding. Not good news for a credit check!

However, post graduation – I am now earning a reasonable amount of money (though Steve if you’re reading this – more dosh would be great ;-D ) and I paid off my credit card bill in full two months ago. I intend to take up a professional qualification next month and whilst I still have no savings or pension or mortgage or any other investments the media rant on about – I do feel I’m making progress (albeit in small steps).

But what about the credit record?

Applied through myCallcredit and paid – and was given the impression that it was a straight-forward procedure, but upon logging into my account (and waiting for the password through the post) – I am now told that they have insufficient information on me to give a credit check. I have to provide them with physical copies of statements from previous addresses.

This may be fine, but I also know that there are some addresses about which I have no evidence. For most of my time at uni, mail was nearly always redirected by my parents from home. In my current flat – council tax and utility bills are included in the rent – so I have very little paperwork coming through by post.

I rarely get bank statements changed – as it works well just collecting them periodically from my parents and I may well move again in the not too distant future.

Fortunately I am sure that I have some evidence kicking about at home, but surely there must be lots of other graduates like me – who maybe haven’t kept any bills or bank statements. What do they do?

Ok – lots of us mess up at uni – but when we try to clean up our act in graduation, why is it so hard to monitor the progress we’ve made?

Watch this space, I’ll keep you posted on how the process of checking your credit record goes.

Frogs and fishes,

Cash Z ///