Financial Education

What goes into a credit score?

Data from your credit report goes into five major categories that make up a FICO score. The scoring model weighs some factors more heavily, such as payment history and debt owed.

Payment history: (35 percent) -- Your account payment information, including any delinquencies and public records.

Amounts owed: (30 percent) -- How much you owe on your accounts. The amount of available credit you're using on revolving accounts is heavily weighted.

Length of credit history: (15 percent) -- How long ago you opened accounts and time since account activity.

Types of credit used: (10 percent) -- The mix of accounts you have, such as revolving and installment.

New credit: (10 percent) -- Your pursuit of new credit, including credit inquiries and number of recently opened accounts.

According to statistics, researchers found that 78% of Americans are living paycheck to paycheck. How can we stop the cycle of living paycheck to paycheck?

Answer:
Make a zero-based budget before the month begins. A zero based budget simply means that you’ve given every dollar an assignment. A budget is all about being intentional. It helps you create a plan so you can see where your money is going and find out how much you can actually save each month.

“Your income is your most powerful wealth building tool.” - Dave Ramsey