Be Credit Smart and Save Money

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Are you credit smart? Take a moment to learn the basics.

"Being credit smart can help you save a lot of money and be the first line of defense against identity theft."

Being credit smart can help you save a lot of money and be the first line of defense against identity theft. While credit reports, credit scores, credit card user agreements, annual percentage rates, and loan agreements can all be rather complicated, the definition of credit itself is fairly simple:

Credit can be defined as a contractual agreement in which a borrower receives something of value now (money, goods, or services) and agrees to repay the lending party at some time in the future.

If used wisely, your credit can be a key to your financial future. Credit can be one of your best friends or, if you're not careful, one of your worst enemies. Good credit can be a valuable asset to help you save money through lower financing charges on a home loan or refinance, auto loan, personal loan, and more. Your credit score can even affect your insurance rates or whether you're hired for a job.

The wise use of credit can be an important tool to help shape your financial future. Excessive use of credit can lead to serious financial problems, and years of stress over having to pay off debts resulting from unnecessary impulse purchases.

"At stake is more money than most people imagine - literally tens of thousands of dollars or even more over the lifetime of a borrower."

So how much does credit cost you? The answer to that question will go a long way to determining your financial future. At stake is more money than most people imagine - literally tens of thousands of dollars or more over the lifetime of a borrower.

Your cost of credit is the interest rate you are charged for the privilege of borrowing, and normally that interest rate depends mainly on the credit snapshot you present of yourself to lenders. That's why it is so important to make sure the information contained in your credit report is accurate. Your credit score and the information in your credit report could cost you - or save you a lot of money!