Good credit karma comes from good credit habits.

As I've watched TV lately, I've seen many ads by a company called Credit Karma. They believe that access to your credit score should be free. We'd agree with that! Interestingly enough, the word Karma is more important than it seems at first glance too. According to the Merriam Webster Online Dictionary, Karma is: the force created by a person's actions that some people believe causes good or bad things to happen to that person.  This couldn't be more true when it comes to your credit score!

But what is your credit score really? 

And what does your credit score mean to you?

Your credit score is a very important number in your life. It can affect where you work, where you live, whether or not you'll qualify for a loan, how much you'll pay to borrow money, and it can sometimes even determine who will date you! (Would you really want to date someone who isn't responsible with their finances?)

As you can see, your credit score literally touches just about every area of your life in today's culture. If you don't know your credit score or don't understand where it comes from, read on.

Learn more about responsible credit card use.

What is your credit score?

It is a number that is calculated from your credit report. It gives someone who is considering lending you money a quick way to determine their risk based on whether or not you have good credit habits. Your credit report is a record of your credit history and any past or current financial problems. The more you've borrowed and paid off on time, the better your score will be. Conversely, if you had some credit problems in the past, your score will be lower. Just like Karma, good actions lead to good credit scores; bad actions lead to bad credit scores.

The action that has the biggest impact on your score? "Payment history without a doubt," says HFCU Member Advisor Lorie Skelton. "Make sure everything is always paid on time!"

If you've never borrowed any money, you won't have a credit score. This would make it very difficult for someone to determine the risk of lending you money.

Credit cards have a major impact on your credit score. Before most people borrow for big-ticket items like a house or a car, they begin establishing credit history with a credit card.

If you're just starting to build your credit or develop better money skills, grab our free Credit Card eBook below and learn more about The Dos and Don'ts of using a credit card. Follow the tips contained in this eBook and you will have lots of good karma while using your credit cards!

Learn more about your credit score, or just know what it is, or contact us and ask for a Member Relations Repsentative. They can give you your credit score and review your credit report, right over the phone.  

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About Author

Bill Burpeau
Bill Burpeau

Bill Burpeau is a Financial Wellness Coach at Hanscom FCU. As a Credit Union Certified Financial Counselor, he is an enthusiastic advocate of everyone being engaged in their financial health, educated and empowered to make the best financial decisions for themselves every day. He constantly studies and is up to date with the latest financial management concepts and technology. Bill is a graduate of Texas A&M University with a BBA in Business Management and served in the U.S. Navy as a Supply Officer.

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