Credit repair can be a stressful endeavor and many people vow to swear off using credit altogether to avoid getting themselves into another mess. It used to be that getting credit was an exception to the norm and people could choose to live solely off their weekly paycheques. Thomas Jefferson is quoted saying “Never spend your money before you’ve earned it” and while this may have been good advice in the early 1800’s, our economic climate has changed dramatically since then. Today having good credit provides you with far more opportunities than simply financing a car or getting a loan. Consider how having good credit could impact you in each of the following areas:
Canada’s population has expanded steadily since its confederation and as a result the demand for housing has increased; gone are the days of buying homes for a few thousand dollars. The price of a home would be a staggering amount if you were to consider paying for it in cash. In today’s market you’ll need to rely on mortgages to finance your housing needs. Bad credit mortgages are available and can really be a help but having good credit will undoubtedly save you money in the long-run.
Saving to buy a car with cash would be nice, but if your financial situation is like most Canadians’ you’ll need to get a loan using your credit. Having good credit could save you substantial amounts of money in interest.
Many employers routinely run credit checks before hiring employees to get an idea of what your financial needs are. If you have bad credit your employer may be worried that the amount of compensation they can offer you may not be enough and they might infer that you’ll leave the position once you find a higher paying job. This can decrease your chances of getting hired.
Many of us consider access to electricity a basic need but it’s not considered a right. You’ll essentially be borrowing your first month of electricity and if you don’t have good credit the electric company may deny granting you access.
Dreams, Goals and Health:
Loans can be extremely helpful in getting a business idea off the ground or pursuing a long-term dream you may have. Although you should have an emergency savings fund for health costs, there may be a time in your life or a family member’s when your savings and insurance aren’t enough to cover your health needs. Having good credit can protect you in emergency situations.