Instant Millionaire Credit Score

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.

The Millionaire Next Door

The millionaire next door is a person who is frugal. He understands that wealth accumulation can be accomplished only by spending less than you earn.

Living below your means is the surest way to become wealthy.

Living the rich lifestyle you "deserve" and spending based upon future earnings potential is the surest way to ever increasing debt.

A Penny Saved is (NOT) a Penny Earned

Ben Franklin was right to say that "A penny saved is a penny earned." This was true until 1913.

The Sixteenth Amendment to the Constitution passed in 1913 states: "The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several states, and without regard to any census of enumeration."

Now, with federal, state, and local income taxes, your money doesn't go as far as it did in Ben Franklin's day.

About a third of your earned money goes to income taxes. To make a dollar of spendable money, you need to earn $1.50. The first 50¢ is removed by income taxes leaving only $1.00 for spending.

So, today, Ben would have to say: "A dollar saved is a dollar and a half earned." You can see how budgeting, saving, and being frugal is much more important than it used to be.

Making a Personal Budget

A personal budget helps you take control your future. There are simple techniques to gain control over your finances.

A personal budget is a money plan. Think of your family as a business.

Every successful company has a budget. It's a plan involving income and expenses.

To be financially successful, you need one too.

A personal budget helps organize your money to achieve financial goals. It helps control your financial resources. Your personal budget will show how your money will be used for your benefit. A personal budget is really simple but powerful.

To create a person budget for your financial success please visit Financial evaluation of your income and spending.

Credit Report Scores - Computing Then

Your credit report scores are based on factors that appear in your credit reports. Credit report scores are computed based on a model developed by Fair Isaac Corporation and are typically know as FICO scores. They help lenders determine the risk of extending credit to prospective or existing borrowers.

The following general factors are considered:

• Bill payment history -- 35% of your FICO score (Good: on time and for the full amount)
• Debt relative to your credit limit -- 30% of your FICO score (Good: few installment loans, Bad: many debts, maxed out credit cards)
• Length of credit history -- 15% of your FICO score (Best, entire credit history of 7 years shows no negative reports)
• Types of credit -- 10% of your FICO score (Good: mortgage, car loans, Bad: high interest credit card debt)
• New credit -- 10% of your FICO score (Bad: many rejected applications, new accounts, or credit inquiries)

All these factors are considered in computing your credit score.

Your credit report contains personal information, credit payment history, credit inquiries made when applying for credit, collections, as well as public record information from courts such as backruptcies, foreclosures, wage attachments, liens and judgments.

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.