Get The Tea On The Good, The Bad, And The Ugly Of Your Credit Score
Didn't know April is Financial Literacy Month? Well, now you do. And what better excuse to get your finances in check or figure out how you'll add to your already lit bank accounts? Let's get into some knowledge about credit. It's an issue we all face as we look for ways to reach financial freedom and the best road to where the money resides. Sadly, the stats reflect harsh realities for many of us. Fifty-four percent of Black adults report having no credit or a poor to fair credit score (below 640).
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Carmen Perez, Varo Bank's personal finance advocate and creator of MakeRealCents.com, a financial fitness platform, shares the good, bad and ugly on credit. Perez, an award-winning professional who's worked for Citi and Morgan Stanley, successfully paid off $57,000 of her own debt in less than three years.
"My finances were a hot mess up until I was able to commit to a plan," she shares. After facing a lawsuit from a private lender, she had to use her last bits of savings to hire a lawyer. She readjusted her budget, completely cut out luxuries like eating out and investing in cable, and reinvested her time into a photography side hustle to bring in more cash. She also kept a close eye on her finances and savings via the cash envelop system, and by the end of 2018, she was debt-free.
It's always good to know where you are before creating a plan to get to where you want to be. So, let's get into some credit 101:
Your Credit Score: The Basics
A credit score, also referred to as your FICO score, is a number that lets lenders know how much of a risk it would be to lend you money. The score ranges from 300 (the lowest) to 850 (the highest). "It is a benchmark that lenders use to gauge how likely a person is to pay back what they owe based on past data. The more you pay things back and on time, the better your credit can be, which can help you borrow money at a lower rate for things you may need," Perez says.
There are three major credit reporting bureaus, TransUnion, Equifax and Experian, and each uses different reporting methods, thus you could have up to three different scores.
"The misconception is that we have one credit score, which is inaccurate. We have multiple, and it depends on what we're applying or aiming for," Perez says. "Your bank, for example, could be showing you a FICO score that might be conducive to opening a credit card, but your score might be different when applying for financing for something else."
Also, various things can impact your credit score, from late bill payments or rental debts to outstanding medical bills and tax liens. On the positive side, a long history of maintaining accounts in good standing, or taking on debt that you're able to manage and pay back consistently over time, are all actions that can contribute to a great credit score.
You can access your credit scores for free via AnnualCreditReport.com, and each report will have specifics on the types of accounts you have on record (such as credit card, mortgage, and student or car loans), the date those accounts were opened, information on your credit limits or loan amounts, as well as details about your payment history. Credit reports also have history on where you've lived and sometimes where you've worked. You'll want to make sure all information is up to date and accurate, especially since some information could be from fraudulent activity, a reporting misake, or an old debt of more than several years that should have dropped off.
For more information on your credit reports, look into resources offered by the credit bureaus, including apps that offer weekly updates on your credit score, credit report information, and credit products available to you. Other easy-to-use and super-helpful websites on understanding your reports are CreditKarma.com and USA.gov.
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Your Credit Score: The Good
The benefits of having a "good" credit score, which is one that falls generally at a 700 or above, is access to more housing options, more confidence when applying for a loan, and lower interest rates when you get approved. "Good credit allows you to secure better housing and, in some cases, will enable you to bypass having to put a deposit down if you rent," Perez adds. "If you plan on owning, good credit can help you secure a mortgage with better financing terms for you in the long-term. The lower your interest rate, the less you'll pay in interest over time."
"You'll feel less worried about getting denied, which can help you focus more on the things that matter, like negotiating a good interest rate."
But what about if you have no credit at all (i.e. no active accounts being reported to the credit bureaus or your credit history is so limited that there's no score)? Perez recommends getting a secured credit card, one that requires a deposit but offers other great benefits for people who haven't built credit.
"Get one at bank or financial institution that you're looking to have a long-term relationship with---one that offers access to other products. You might put up $500, for example, to open the account, and it will give you access to other products later that you might find beneficial such as home and auto loans."
She also urges women to put some serious thought and research into making decisions about what cards might be best for them. Looking to resources like Nerd Wallet or reading up on your current bank's credit card options (along with the fine print) are your best bet. Be sure to get details on annual fees, card closure policies, and payment protocols.
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Your Credit: The Bad
In some cases, with a credit score that is below 640, a lender sees you as a higher risk for default or nonpayment of a loan. "If you haven't been good at paying back the money you've already borrowed, lenders will be more hesitant to lend you money," Perez says. "Since they are lending you the money, your loan terms, whether it be a mortgage, car loan, or credit card, will be more favorable for the lender than they will be for you. And since the lender is taking on all the risk, their reward is being able to charge you with a higher interest rate. Interest over time can add up and take away money that could be going toward your future self, like investing for retirement."
Though cash is king, when it comes to buying a home or even renting an apartment, you may need a cosigner to vouch for a loan. "Getting someone else to cosign on anything can be pretty tricky, especially when you already have bad credit," she continues. "You may also be subject to paying high deposits, which can deplete you of cash that could be going toward things like your savings or retirement."
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Your Credit Score: The Ugly
In Perez's case, she was sued for an outstanding debt, and this is a common practice for some lenders as well as medical service providers and property management companies. Accounts that have reached collections stages and wage garnishments can not only deplete your pockets, but they can indeed negatively impact your credit score. A bad credit score can even affect your employment opportunities. "Sometimes employers will run a credit check on you before giving you the job," she says. "If your credit isn't in a good place, they may not extend the offer."
But you can take bad credit and turn your situation around. Perez recommends looking at all your credit reports and disputing anything that might be out of date or inaccurate. Then address the open accounts with balances that are past due. "Get on the phone with your lender. Explain your situation. See if they have a hardship program, and get the information on what that actually looks like. Get those details up front first, and then go from there." Perez also suggests freezing your credit card and pausing on use versus closing them, something that could negatively impact your credit. If possible, remain in communication with companies or lenders you owe to negotiate a plan for resolving your debt. "If you get the no the first time, continue to call to see if you can get yourself on a payment plan. That's better than [the lender] hitting up your credit because you're not making payments."
There are also credit-card debt relief options offered with the understanding that many are facing pandemic-related hardships, and community resources to get help in building budgets or exploring other debt-relief options.
Perez is also a big advocate of finding a way to earn more income via a side hustle and paying down at a pace that takes into account your current lifestyle and necessities. "Make sure you're prioritizing your bills. If you're in a hole and trying to make it out, it's time to put a budget in place and figure out where your money is going."
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ItGirl 100 Honors Black Women Who Create Culture & Put On For Their Cities
As they say, create the change you want to see in this world, besties. That’s why xoNecole linked up with Hyundai for the inaugural ItGirl 100 List, a celebration of 100 Genzennial women who aren’t afraid to pull up their own seats to the table. Across regions and industries, these women embody the essence of discovering self-value through purpose, honey! They're fierce, they’re ultra-creative, and we know they make their cities proud.
VIEW THE FULL ITGIRL 100 LIST HERE.
Don’t forget to also check out the ItGirl Directory, featuring 50 Black-woman-owned marketing and branding agencies, photographers and videographers, publicists, and more.
THE ITGIRL MEMO
I. An ItGirl puts on for her city and masters her self-worth through purpose.
II. An ItGirl celebrates all the things that make her unique.
III. An ItGirl empowers others to become the best versions of themselves.
IV. An ItGirl leads by example, inspiring others through her actions and integrity.
V. An ItGirl paves the way for authenticity and diversity in all aspects of life.
VI. An ItGirl uses the power of her voice to advocate for positive change in the world.
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Not too long ago, while in an interview, someone asked me for a top complaint that I hear husbands say (first) and then wives state (second) as it relates to what goes down (or doesn’t go down) in the bedroom.
Ladies first: when it comes to women, I think what comes up more than anything might surprise some: it’s boredom. A lot of wives want there to be more spontaneity instead of taking the “If it ain’t broke, don’t fix it” approach from their partner. As for men? I mean, would anyone be shocked to hear that they wished their wife would initiate sex more often?
I’m telling you, over frequency, technique, and even dressing up more for bed (and yes, those things also come up quite a bit), hands down, what I hear that more men want is for their partner to show them that they are desired by taking the initial steps to make copulation happen…more often.
And so, since I’m all about doing whatever I can to reduce dissatisfaction and frustration in the bedroom department, let’s explore this very topic today — from a few angles. For starters, what it truly means to be a sexual initiator; two, why it’s so vitally important to be a sexual initiator, and three, why it could literally change the entire tone, energy, and outcome of your sex life with your partner — if you’d simply be open to initiating sex more often than you (probably already) do.
What It Means to Initiate Something. LITERALLY.
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I’m word-literal — there’s no secret about that. So, when it comes to the topic of initiating sex, let’s start with what the word means. To initiate is “to begin, set going, or originate” and “to introduce into the knowledge of some art or subject.” Some synonyms for initiate include begin, open, set up, trigger, admit, introduce, and invest. And when it comes to all of the meanings of these words, between men and women, when it comes to sex specifically, guess who does it more? Men. BY A LONG SHOT TOO: a whopping 60 percent.
When it comes to why a lot of women are so comfortable with men initiating intimacy, many think that, just like men should pursue them for a relationship, it is also “the man’s role” to pursue sex in the bedroom; they literally think that it makes them look desperate or needy for them to be the initiator — yes, even as a wife. What in the world?
Listen, when two people sign up to be each other’s exclusive sex partner until death parts them, it means they are both saying that they desire each other so much that they are willing to make that kind of commitment — and so, there should be no “I don’t want to appear this way or that” when it comes to sexual activity.
So, with all of that ridiculous overthinking out of the way, that should make you want to “set up” some sex plans, “admit” to some sexual fantasies that you may have, and “introduce” some new ideas to your partner; especially since that’s exactly what so many men wish that their lady would do, to begin with.
So, with all of this said, if you’re someone who is hung up on not initiating, first spend some time really processing what the word means. Because when two people are eager to begin sex and invest in each other sexually, that is the recipe for a truly satisfying experience…over and over and over again.
C’mon. Who Doesn’t Want to Feel Wanted?
GiphyI remember once reading an article that said our brain processes rejection the same way that it does physical pain, and y’all, I don’t know about you, but if something is physically hurting me, my natural inclination is to get away from it. Along these lines, when it comes to relationships since research has proven that rejection can lead to things like jealousy, shame, anxiety, loneliness, and guilt — yes, it makes all of the common sense in the world that you would want to do all that you can to make your partner feel wanted…both in and outside of the bedroom because, just like no one wants to deal with physical pain, no one wants to keep dealing with rejection and all of the fallout that comes with it…either.
Actually, when it comes to this particular point, I think that an article that I once read on Psychology Today’s site said it best: “Not only does being needed help define your role in a relationship, but being needed can also influence how satisfied you feel in a relationship.” And before some of you say that “sex is not a need” — the hell you say? I mean, the only purpose of your clitoris is to provide sexual stimulation, so that alone should make us all deem sex (and sexual fulfillment) as pretty damn important.
Plus, by definition, a need is something that is deemed as being essential while also being something that is extremely necessary, and anyone who thinks that a romantic relationship doesn’t need physical intimacy? That’s someone who really needs to remain single because one of the top things that makes a relationship more than a friendship is there is intimacy that’s involved.
Besides, who doesn’t want to feel wanted by their partner — and I do mean, in every way? And when you make the decision to be in an exclusive relationship with someone else, you are declaring that they are someone who pleases you to the point where you don’t need to look for anyone else to do it; and, if that is indeed what you are saying, it doesn’t make sense that you wouldn’t initiate sex with them sometimes (and I do mean more than on their birthday).
One, because you choose them to “fill that role.” Two, because they are the source of your fulfillment in that area. Three, because it’s completely unfair (not to mention totally hypocritical) to expect them to make you feel wanted when you’re not being intentional about making them feel the same way in return. Not to mention the fact that initiating also helps to safeguard your relationship on a lot of levels too.
Since sex is important and rejection is detrimental on so many levels, it’s crucial to make your partner feel sexually wanted and desired by you. One way to definitely do that is to initiate sex.
What Initiating Sex Does for You
GiphySo, what does initiating sex do for the initiator? Something that I tell a lot of my women clients is it helps them to create an atmosphere that puts them in the mood. What I mean by that is, if their husband is perfectly content having sex on the couch during commercials (I’m kind of exaggerating to make a point…kind of…LOL) while they would like some candles, mood music, and rose petals — they can control that if they are the one who initiates.
Another perk that comes with being the initiator is you have more “control” over how the sex goes. The kind of foreplay you want, how fast or slow things go, how intercourse begins — all of this, you have more of a say so in if you’re the one who is initiating intimacy. Why? Well, think about when your bae initiates — doesn’t it seem like you tend to follow his lead more when he’s the one who is first to get the ball rolling?
Oftentimes, when a couple comes to me about being sexually dissatisfied, and I recommend that the one who doesn’t initiate takes more initiative, the one on the receiving end likes the fact that their partner is “running the show” — and the initiator likes “being in charge” more than they thought that they would. As a result, both end up experiencing far more pleasure.
The initiator shows what they want more of while the receiver feels desired in the process. A win/win for everyone.
What Initiating Sex Does for Him
sexy black and white GIFGiphyA couple of weeks ago, while in a session with a client, he was joking about how much he has “too much of a good thing” when it comes to his wife’s libido. Although science says that the fact that men have a higher amount of testosterone in their system, and it is the reason why they typically have a higher sex drive, don’t sleep on a lot of women out there who want to get it in more than their husband does. His wife is one of them. Since she’s a client of mine too (oftentimes, we do our sessions separately), it’s interesting that he’s fine with having sex a couple of times a month while she would like to a couple of times a week.
So, is he denying her when she wants it more often? Nope. The reason why they’re not having more sex is that even though her drive is higher, she still waits for him to initiate. Why? Because she thinks that’s what “the man should do”; not only that but “being wooed” turns her on more.
As I’ve been working on helping them to find a middle ground (because if marriage ain’t about compromise, I don’t know what is), he says that he feels like because he plans a lot of the dates, he wishes that she would initiate more: “I don’t think a lot of women get how hard it is to be a Black man out here. Nothing feels better than knowing that if no one else is thrilled by your presence, your woman is. For us, initiating isn’t just about sex. It’s about feeling wanted as a whole. And when we feel like our woman adores us, there is no greater turn-on.”
I’m not sure what y’all heard, but what it sounds like to me is when we, as women, initiate sex, men feel holistically special and cherished. That makes sense, too, because if we were to put our feet in their shoes, we would probably say the same thing. That’s just one more reason to pull the “gender roles” out of this topic; men and women both want to feel like they are the best thing on the planet by their sex partners. And again, initiating helps us all to feel that way.
What Initiating Ultimately Does for Your Relationship As a Whole
Issa Rae Love GIF by Insecure on HBOGiphyPersonally, I can only imagine how much better sex would be for everyone (who is in a sexual relationship) if people simply initiated copulation whenever they wanted to have it. That way, everyone would feel desired — and what could possibly be wrong with that? Especially if both individuals factored in some of the definitions for initiated that I already shared. Just think about if you rushed home tonight because you read about something that you want to introduce to your man or there’s a fantasy that you have that you want to admit.
The mere conversations alone will help to bring the two of you closer together because, after all, deep intimacy is about minds, bodies, and spirits getting as close as possible…right? And so, yes, by initiating sex, it can bring more closeness and stability to the relationship as a whole.
And what if you initiate and your partner isn’t interested at the time? Or what if you’re shy about initiating due to having a fear of rejection? That’s a fair and legitimate concern. One day, I’ll need to pen an article on how couples should handle situations like that with grace (on both ends) while applying the golden rule of “doing unto others as you would have them do unto you.” For now, I’ll just say that if this is your greatest point of concern, share that with your partner as well.
After all, it’s pretty unrealistic to expect them to always want it when you do (although it’s been my experience and observation that men are almost always far easier to convince…LOL); just know that not wanting sex at the exact moment that you do doesn’t mean that they don’t want you altogether. Besides, oftentimes, a nap or a night of sleep can rectify that issue. Trust me.
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Rihanna was actually once quoted as saying, “To me, sex is power. It’s empowering to do it because you want to do it.” I personally think that’s a great way to bring this to a close. Make your partner feel wonderful, empower yourself, and strengthen your relationship by initiating sex more often. I can’t think of one reason why it’s not a wise move. Can you?
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