Your portfolio has been key to helping you capture the moments that matter most, like selling off stock for your kids’ education or investing in your 401(k) to fund your retirement. Surprisingly, what’s good for you might not be so attractive to models that determine your credit score.
What you know to be a balanced portfolio may look like a lack of liquidity to creditors. And even though you have the cash to pay off the high credit card balance you racked up on your shopping spree, creditors might perceive your spending habits as risky.
Ultimately, this affects your credit score, which in turn affects the interest rate your bank will offer the next time you seek to invest. Did you know the difference between an “excellent” and “good” score can dramatically affect the amount you’ll spend—and save—over time?
Consider these tips to maximize your credit score and minimize your interest rate
To protect yourself, consider credit monitoring programs that include identity theft insurance. Keeping enough money liquid to cover high credit card purchases will also help keep your credit score healthy while you save for more moments that matter most.
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