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Get smart about credit.

How good - and bad - credit impacts your life.

Your credit score follows you pretty much everywhere these days. Now is a perfect time to remind yourself how credit can help (and hurt) your daily life.

Getting a job.

Prospective employers may use your credit report (with your permission) to decide whether to hire you.1 Why do companies do it? Your credit report has information about where you live, how you pay your bills and whether you've filed for bankruptcy.2

Getting an apartment.

Landlords have access to your credit information, and a low score may mean your landlord rents to a different tenant, or charges you a higher security deposit.1 Utility and cell phone companies will also do the same - if there's negative information on your report, you could be required to pay a deposit, add a co-signer or pay a higher rate.1

Getting a loan.

Looking for a car, home or other personal loan? Lenders may use your credit report to determine whether you can have a loan, and what the terms of that loan would be. A low credit score often means a higher interest rate and you'll pay more for your loan over time. The same goes for insurance - having good credit means you can save money when you're looking for car insurance.3

Getting a better score.

Late payments, bankruptcies, collections and foreclosures can stay on your credit report for up to seven years, but a collection that's five years old hurts less than one that's five months old.3 So if you've made a bad decision in the past, it's not too late to improve your money management skills. To get you started, the federal government has advice on how to build and maintain a good credit score, including the Federal Reserve Board's Consumer's Guide to Credit Reports and Credit Scores.

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Expand Important Disclosures

Perez, Maria. How Poor Credit can Impact your Life. N.p. unknown. N.d. September 2013.

1Consumer's Guide : Credit Reports and Credit Scores. N.p. unknown. N.d. September 2013.

2Employment Background Checks. N.p. unknown. N.d. September 2013.

3MyFICO: Credit Q & A. N.p. unknown. N.d. September 2013.

4Perez, Maria. Signs your Identity has been Stolen. N.p. unknown. N.d. September 2013.

5Signs of Identity Theft. N.p. unknown. N.d. September 2013.

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This article is based on information available in September 2013. It is for general informational purposes only. It is not intended to provide specific financial, investment, tax, legal, accounting, or other advice and should not be acted or relied upon without the advice of a professional advisor. A professional advisor will recommend action based on your personal circumstances and the most recent information available.

Keeping your identity safe.
If your identity has been compromised, acting fast is key.4, 5 Below are a few signals to look for.

  • Suspicious activity on your bank statements: This includes withdrawals or purchases you didn't make or can't explain.
    What to do: Contact your bank ASAP, close all compromised accounts and dispute the fraudulent transactions.
  • Errors on your credit report: These range from new accounts you didn't open, an address you never lived at, and an employer you never worked for.
    What to do: Notify one of the three major credit bureaus (Equifax, Experian or TransUnion) and request a Fraud Alert as well as a copy of your credit report. Dispute any inaccurate information.
  • A company you use has a data breach: This compromise can range from just your name to your bank account or social security number.
    What to do: Notify all creditors with whom you have accounts, including banks and credit card companies.

For more information and tips on how to protect against identity theft read Managing Your Identity.