If you know your resume and cover letters are stellar and you perform well in job interviews, but you’re still not reaching your goal of getting hired in your chosen profession, your credit score/credit report could be holding you back. This is because employers see his credit score as a measure of how well he keeps all the financial promises he made to lenders. It is a known fact that employers want employees with integrity, character, and enough soft skills to fit well with the employer’s existing team. That’s in addition to a lot of experience in the industry. He too could be slowed down by the results of a criminal background check, but he would normally know if that was the case.
The average credit score in the US is 705. An excellent credit score is anything above 739. If your goal is to secure a job in a high-paying profession, you should keep in mind that every job application you make complete normally authorizes employers to check your employment history, references, background checks and credit report. Positions with more responsibility and higher compensation automatically require a more extensive background check, credit check, and background check. If the final two or three candidates are the same, the results of a background check, credit check, or criminal background check often make hiring decisions easier for the employer.
Here are the best ways to improve your credit scores:
- Always pay all your bills on time, or preferably sooner. This is the highest weighted factor in calculating your credit score.
- Start an automated savings plan so you pay yourself first each month and live off the rest. This can be done by setting up automatic deductions from your paycheck to your 401K/IRA/403B, etc. or by using the automatic bill payment service with your online banking to contribute to a savings or retirement account each month. People with the discipline to keep six months of living expenses in a savings account can typically maintain excellent credit and make better financial decisions.
- Keep your credit utilization rate below 30% vs. your credit limits; if possible, a credit utilization rate of 10% vs. your credit limits is ideal.
- In many cases, especially if you have high-interest rate consumer debt, you can use the equity in your home for a debt consolidation loan (pay off debt with a cash-out refinance/home equity loan). the House). In many cases, this will drastically improve your credit scores, but you must have the discipline to keep credit card balances to zero by paying off your consumer debt each month.
- Don’t close credit cards/lines of credit that you paid off, even if you won’t be using them anymore. The more open credit you have and the lower your credit balance, the better your score will be. The older your open lines of credit are, the better for you (stability).
- Maintain stability in your work, profession and home. Frequent changes in your profession, job or address often lead to financial hardship/unemployment because without stability you are a less desirable candidate for credit or employment.
- Work a part-time job at night or on weekends to pay off your debt faster. Pay off the debt with the highest interest rates first for maximum impact.
- If you have had financial problems and have the debts to prove it, write and ask your creditors to agree to expunge your late payment record in exchange for paying your debt in full. Let them know that if they don’t agree to this in writing, you will have to focus your payment efforts on other creditors who are friendlier because you have such limited resources.
- Carefully review your credit records from each of the three credit bureaus because there may be errors that will lower your score. These errors can be as minor as late payments that are still on your credit history even though they are more than seven years old. Carefully follow the instructions for disputing errors on credit reports. Each agency has its own policies and procedures. I recommend that you use certified mail with return receipt requested on all correspondence, so that you have official proof of delivery. If one of your creditors does not respond within a reasonable amount of time, you will automatically win your dispute.
- Avoid bankruptcy whenever possible, including bankruptcy reorganization because both are a public admission that you are financially inept. Everyone knows that lawyers are expensive, and frankly, you could use that money to pay off your debt and get a second job to speed up the process of paying off your debts. Regular consumer debt with late payments will automatically wipe your credit history after seven years. A bankruptcy stays on your credit report under public records for ten years and many employers prefer not to hire applicants who filed for bankruptcy.
- Do everything you can to earn a promotion or a raise at work, which will help you pay off your debts faster. If you’re behind on one, present your boss with a compelling written proposal to make your raise or promotion a reality.
- Hire a CPR or tax accountant to maximize all your income tax deductions. Yes, they are worth it because they usually generate more savings than their fees and you will learn from them!
- Hire a certified professional resume writer if you think you are underpaid or ready to step up and test the job market in your spare time. Employers greatly prefer passive candidates and, in many cases, pay for them.
- Get married, find a great roommate, or rent a room in your home to a college student, artist, or professional to lower your monthly expenses.
- Whenever possible, use public transportation instead of owning your own vehicle and paying for auto insurance. The cost savings are staggering, especially if you have to pay to park on a regular basis.
- Upgrade your education or skill set whenever possible, that way you’ll be in more demand in the event of a layoff and advance/get pay raises faster.
- Ideally, having two credit cards, a car loan/bank loan, and a mortgage is beneficial because it shows that you are responsible enough to have three main types of credit.
- Resist the urge to splurge! Train yourself to be a saver, not a spender, by repeating this mantra: “Use it, spend it, make it or don’t.”
- Request a free copy of your annual credit report every year from each of the major credit bureaus. Search “Annual Credit Report” with Google for the only online source of free credit reports for consumers from all three credit reporting agencies under federal law.
- If any of your creditors have not reported your payment history on time, write to them and request that they report your good payment history to at least one of the major credit bureaus.
- Use your checking account’s online bill pay feature to set up automated monthly/bi-monthly payments for all your debts. This way you will not forget if you have a car accident, mishap, long vacation or are hospitalized. An ounce of prevention is worth a pound of cure.
- Have some type of Hospitalization insurance in the event that you are hospitalized for an illness, injury or illness. AFLAC has several consumer-friendly insurance options, including one that pays you an income while you’re hospitalized.
- Avoid divorce if humanly possible, a healthy percentage of couples end up loving each other again after a separation. If you must get divorced, I recommend using divorce mediators over divorce lawyers because you will benefit from a friendlier process, a more beneficial divorce settlement, and significant cost savings.
- Avoid co-signing auto loans, student loans, personal/business loans, or home loans/home equity loans for friends or family.