MoneyMakingEasier

A lot of people have probably realized most of my blogs have high vocabulary words that younger adults (teens/teenagers) wouldn’t understand. So today I am going to explain it to adults AND lower aged people (not necessarily kids). Even if you are an adult you can still use the simpler way to help understand better.

What are credit scores?

Complex Version:

A credit score is a number that helps lenders estimate how likely you are to repay borrowed money. People can get this information based on whether you pay your bills on time, how much debt you already have, how long you’ve had credit accounts and/or how often you apply for a new credit. Therefore, more people will seek you out because you are more trustworthy than others.

Simpler Version:

Let’s say your friend lends you a video game. If you return it on time and in good condition every time, your friend starts to trust you more. If you lose it, break it, or return it late, your friend trusts you less.

Then next time when you lend something (anything) else from them they are more likely to trust you and give it to you more willfully. This helps many people gain trust from others. Making you more trustworthy. That is the simple version of what credit scores are.

How Can I Improve My Credit Scores?

Complex Version:

There are a lot of different ways to help improve ones credit scores. This is a list of a few:

1. Have a good payment history
2. Pay down existing debt
3. Avoid maxing out credit cards
4. Review your credit reports for failures
5. Use credit regularly but responsibly

Simple Version:

There are many ways to help improve your credit scores. Here is a list of some options:

1. Pay on time
2. Don’t borrow more money than you can handle
3. Build a good record over time
4. Check your statements regularly
5. Avoid a lot of new accounts