How To Use Charge Cards Wisely

Credit Report Scores - Who Determines Them?

There are three major credit reporting agencies: , , and .

Each of these credit reporting agencies receives information from credit grantors such as credit card companies, stores granting credit, mortgage companies, and banks. They compile your credit history and compute your credit report scores.

They provide your history and credit report scores to others who have a genuine interest in your credit worthiness.

Using Charge Cards Wisely

Too many people think that a charge card is a "license to charge"--a license to go deeper into debt.

The middle class have been educated by the media to want all the good things in life. "You deserve the very best." A charge card is the easy way to live the good life today.

The fact is the average person has $6,000 to $7,000 in charge card debt. Many people have $10,000 or $20,000, or even more, in credit card debt. Credit card debt has the highest interest rate of any debt short of a loan shark.

While there are emergencies, wise use of charge cards suggest that you pay off your outstanding balance monthly, or at least several times a year.

How to Spend Money Wisely

In his book Rich Dad Poor Dad Robert T. Kiyosaki shows what the poor, middle class, and the rich buy on payday.

The middle class buy liabilities. They buy a bigger home, new cars, big screen TVs, club memberships. These purchases are all too often made on credit. They create a monthly mortgage payment, monthly credit card payments, monthly membership payments. As the middle class make more money they reason that they can buy more goods and services on credit.

The result is that they always feel their income is never enough. Every time they get a raise they buy more expensive items on credit. This never ending cycle of increasing income and increasing debt payments is called the "rat race".

The rich discipline themselves to avoid instant gratification. Instead of purchasing liabilities, they purchase assets. They continue to accumulate assets because assets produce a cash flow.

As you accumulate assets your cash flow will increase. When your cash flow exceeds your income from your job, you have bought your personal financial freedom.

Read the details of how you must transform your thinking to really spend your money wisely. Read Rich Dad Poor Dad.

Credit Report Scores - How to See Them

Each of the three credit reporting agencies can provide you with a one-time copy of your credit report. Equifax, Experian, for example, will provide your report online for a fee of $9. Trans Union charges from $7.50 to $9 for your credit report.

All three credit reporting agencies will also provide a one-time copy of a "3-in-1" credit report. This contains your credit reports and your credit report scores from all three reporting agencies. Trans Union charges $34.95 while Equifax and Experian each charge $39.95.

Credit Report Scores - Improving Then

A good score helps you get the best loans. The loan officer will be glad to see you because you will:

• Qualify for a larger loan
• Get a loan faster
• Get the best interest rates.