Watch Your Score

In my previous article, I mentioned how maintaining good credit standing benefited us. It takes discipline and determination before anyone would be able to establish good credit history. I cannot speak for other people but I can share how we did it. 

First, we only maintain three credit cards from major financial institutions. We have one Visa, one Mastercard, and one American Express. We turned down hundreds of credit card offers. Applying to every credit card offer would lower your credit score.

Second, we do not use our credit cards at the same time. We also make sure that when we do use them, the whole amount will be paid off when the bill comes. In that way, we will not worry about late payment. It is another factor that affects credit standing.

Third, we designated one card to use for our regular shopping. It makes it easy for us to monitor our spending. This is the card that gives us cash back for every purchase we make. It is tied up with Costco so we do not have to pay the credit card's annual fee. 

Every year, we receive two cash back checks; one from the credit card company and one from Costco. The amount in those checks covers our Costco membership fee. 

Fourth, we use the other two credit cards just enough to keep them active and in good standing. Two to three times a year would be enough.

Fifth, we only use 10 to 20 percent of our credit limit. It sends a bad signal to the creditor when your balance is more than 50 percent of your credit limit.

The last point is a bonus point. My husband and I competes on who gets the highest credit score. Our finances are consolidated so it is always a tie. 

Yes, it is important that you and your spouse are in the same page. A family that creates good credit together saves together.

Costco Membership + Good Credit = Huge Savings

When our twelve-year-old car started to give us so much problems, we knew it was time to buy a new one. We started checking prices online, then we visited different dealerships. We knew what car we wanted and we were just finding ways on how to get good deal. 

Now, we are Costco Executive members and every month we receive their magazine in the mail. We have been wondering about their car buying program. We do not know anybody who used it but we thought we would give it a try.

We were surprised how easy the process was. Costco connected us to the dealer. There are sales agents that are assigned to help Costco members. We were able to meet with him the same day, BUT, before we went to see him, we went online and printed the price of the car that we wanted to buy. In that way, we will see if we were really getting a Costco member discount or not.

To our surprise, we did. We got over a thousand dollars discount! Then, after checking our credit report, the agent said we are qualified for 0% APR financing! How cool is that! The agent was even surprised that we put a down payment on it. He made a comment we could have just used the money for other things. We could but we wanted our monthly payment as low as possible.

Our payment ended up just over a hundred dollars a month. Included in that payment is a seven-year extended warranty. We were more than satisfied when we drove our new car home. It pays to maintain good credit standing. It came handy when we needed it.

Oh, and did I say we love Costco?