“A new survey from BMO Harris Bank shows consumers are confused on how credit card balances affect credit scores. . .”
While using a credit card is one of the easiest ways to build credit, there are plenty of misconceptions about how best to do that. According to this survey
- 39 percent of Millennials—people between ages 18 to 34—believe carrying a balance increases their credit scores. In fact, carrying a balance does not improve credit scores and can actually hurt scores.
- 23 percent of those surveyed indicated that a person’s educational level affects his or her credit score. In fact, a credit score is based only on the information in your credit report, and educational level is not included in your credit report.
- 27 percent of those surveyed thought checking their credit scores would lower their credit score. In fact, the opposite is true: If you regularly check your credit scores, it’s likely you’ll make financial decisions that will improve your credit score.
For more information go to http://finance.yahoo.com/news/credit-card-mistake-thats-costing-103040745.html
You may want to use the information in this blog post and the original article to
- Discuss why a credit score is important.
- Stress the importance of “managing” credit card debt.
- What affect will your credit score have on the finance charges you pay for credit purchases?
- How can your credit score affect your ability to purchase a home or an automobile?
- Assume you have a low credit score and have been turned down for a home mortgage. What steps can you take to increase your credit score?