As a former high six figure earner and as a bankruptcy and foreclosure survivor, I have seen both sides of this coin first-hand. As a credit and lending professional for over 20 years and having created the Better Credit Blueprint, I know what it takes to get your credit back on track. But this really is the million dollar question, isn’t it?
What’s more important; having good credit or making good money? I can tell you this; anyone can live without good credit! This doesn’t mean you shouldn’t work on improving your credit. What it means is if you can earn and save your money, you can live comfortably regardless of your credit rating. Don’t believe me? Well let’s put that theory to the test!
You Need Good Credit for Housing
As a Real Estate and Mortgage Professional for the last 10 years, I can tell you that you need good credit to purchase a home and your credit will be checked if you’re looking to rent. But without getting into the whole buying versus renting debate, if you are earning good money and have cold hard cash on hand, you will find a good place to live! If you have 3 to 6 months minimum to put down as a deposit and your situation can be explained, you will not have to settle for less!
You Need Good Credit to Buy a Car
As a former bank representative and car buyer, of course your credit will be checked if you want to finance or lease a car. But without getting into the whole leasing versus buying versus paying cash debate, if you are earning good money and have cold hard cash on hand, you can flat out still finance an automobile or just pay cash! Will you pay more in interest? Of course! If you’re buying cash, will you have to buy used? Probably! That’s what I did but again, your lack of resources will hurt you more than your lack of good credit! I’m living proof.
You Need Good Credit for Utilities
If you have ordered new cable service recently like I have, or have tried to switch your phone service, you know one of the first things these companies do is pull your credit. If you have bad credit, these companies will ask you for a security deposit to establish service in your name. I have also read where some companies are able to offer no credit check utility service by charging a higher rate to account for the “so called” added risk. But once you establish a solid payment history, usually 12 months, that deposit is usually returned to you and moving forward, if you need to transfer that service, you will not be asked for a deposit.
You Need Good Credit for Cell Phone Usage
This one, as far as I’m concerned, is the most perplexing to me. Why in the hell would you want to get into a 2 year contract for cell phone usage when you can get a prepaid cell phone on a month-to-month contract? Oh, I see, you want an iPhone. So buy the iPhone through Virgin Mobile which works on the nationwide Sprint® 3G Network and it will only cost you $50 dollars a month for unlimited usage with no contract. And if you sign up for auto-pay, they discount that $5 dollars. In fact, just about any phone you want is available through a pre-paid cell phone service. Sure you’ll pay more for the phone, but credit won’t stop you from getting what you want!
By Using Cash You Are Actually Rebuilding Your Credit
Say what? Yeah, you read that right! Pay your rent on time; you’re rebuilding your credit. Pay your car payment on time; you’re rebuilding your credit. Pay your utilities on time; you’re rebuilding your credit! While you’re doing this, you can perform a Credit Audit and Verification of your credit report and start checking for errors and inaccuracies to dispute and work on bettering your credit.
You can also get a secured credit card to help with that rebuilding process. Again, if you are generating good money and being smart with it, you can live how you want. To be sure, I’m not arguing against having good credit, I mean, my whole blog is about accelerating that process. What I am arguing against is thinking the only way you can live comfortably and how you want is to place the most importance on chasing an 800 credit score and relying on credit for your quality of life. As a bankruptcy and foreclosure survivor, I’m living proof it can be done but; I’m still working on improving my credit as well!
The Moral of The Story is this; worry about getting your financial situation settled first! Start making the money you want, and need, and everything else will follow! Especially if you have just come through credit and financial hell like I have. I’d love to hear your thoughts on this subject so please, leave me a comment below
P.S. Don’t forget to check out my new eBook “How Credit Card Debt Settlement AffectsYour Credit Report and What You Can Do About It” available exclusively at Amazon.com