Boost Your Credit Score with Benevolent Bacon

In today's financial landscape, a good credit score is essential for achieving your financial goals. Whether you're looking to buy or rent a home, purchase a new car, consolidate debts, fund a project, secure personal or business loans, or even get a new job, your credit score plays a crucial role. But a "good" score alone won't help you; you need a good credit profile and strong credit fitness. Enter Benevolent Banking—a fresh approach to finances, teaching you what to do, helping you do it, and guiding you towards financial freedom. We have the tools, knowledge, and experience to help you get moving in the right direction, no matter where you're starting from, or how ugly you feel your credit and finances may be now...we've got you covered!

A simple piggy bank can serve as a helpful reminder to spend wisely and intentionally build your savings, and it can be a great tool to teach kids about money and budgeting. Painting it to look like a piece of bacon has not been proven to improve your finances, but it seems like a good idea to us!

Understanding Credit Scores

Before diving into how Benevolent Bacon can help, it's important to understand what a credit score is and why it matters. A credit score is a numerical representation of your creditworthiness, typically ranging from 300 to 850. The higher your score, the more likely you are to be approved for loans and credit cards, often at better interest rates.

There are two primary types of scores, FICO and Vantage scores, and they are used by the three primary reporting bureaus: Experian, Equifax, and TransUnion. The rating scales are not equal across them, so a 750 vantage score on your Experian report is not the same as a 750 on TransUnion. Additionally, the bureaus pull information from different sources, and lenders (or other reporting entities) may not report information to all of them. So, you may have information on one credit report that does not show up on another bureau's report. This is why it is important to review all three.

Key Factors Affecting Your Credit Score

1. Payment History: This accounts for 35% of your score. Timely payments on loans and credit cards are crucial. A single late payment won't destroy your credit, but several late payments can certainly hurt you.

2. Credit Utilization: This is the ratio of your current credit card balances to your credit limits. Keeping this below 30% is what most banks want to see, but below 20% is advisable. This means that if you have three credit cards with $1000 limits on each of them, then you would want to keep your individual balances on each card below $300, AND the total of all balances should be below $900 ($300 x3 cards). Carrying balances above this level (30% utilization) will begin to reduce your score.

3. Length of Credit History: The longer your credit history, the better it is for your score. There is no magic number, but generally 2-3 years of history is what banks like to see. This applies to more than credit cards though, for larger loans, the banks may want to see 2 or more years of work history with the same employer, tax statements, the same home address, the same banks, etc. All of these things have an impact on your credit fitness.

4. Types of Credit: A mix of credit types (credit cards, mortgages, automotive, etc.) can positively, or negatively, impact your score.

5. New Credit: Opening several new accounts in a short period can lower your score.

6. Inquiries: 1-3 is usually fine, 4 or more inquires on your report can be a problem. When a lender considers a loan application, they often do a "hard pull" on your credit which records that an inquiry was made to review it. Banks can also do this when reviewing your credit while you have an open account with them. A single hard pull may reduce your score by a few points, but several inquires can raise concerns. A "soft pull" allows a bank or other financial entity to review your credit without recording any inquiries or impacting your score(s).

7. Negative Factors: A "negative" factor can be anything considered unfavorable related to the list above, or it can be specific independent issues. A charge-off, or charge-back, means a creditor has claimed a delinquent account for a financial loss. They may or may not opt to sell this account to a debt collection company. If so, you could have both a charge-off and a collection listed. These are not good and will definitely hurt your credit. However, there are a few things that are even less favorable, such as reposessions, foreclosures, and bankruptcies. These will have a severe impact to your credit and can be very difficult to overcome.

   
   

These are the basics, and understanding these factors can help you make informed decisions about your financial habits to improve your credit.

What can Bacon do for you?

Benevolent Bacon is more than just a name; it is a playful, memorable, and effective approach to managing your finances, growing money and building wealth. It combines traditional banking principles, teaching things most lenders don't want you to know, and developing a personalized strategy to help you go from wherever you are...to where you want to be. More importantly, we are consultants and advisors, here to help you along your journey from concept to creation, and setup to operations, all to see you succeed. So, even if you have bad credit, limited experience or education, or perhaps you want to get started but simply aren't sure which direction to go...we can develop a plan that works for you and help put you in a position to build the financial future you deserve.

Here are some Practical Tips for Boosting Your Credit Score:

1. Make On-Time Payments

One of the best ways to protect your credit score is by making timely payments. Set up reminders, automatic payments, and use a tracker for paying your bills on time.

2. Manage Credit Utilization

Benevolent Bacon encourages you to keep your credit utilization below 30%, but 20% is better, and under 10% is ideal. By monitoring your credit and tracking your balances, you can avoid surprises over the credit you’re using.

3. Build a Diverse Credit Profile

Credit types are not created equal and you want to show mix of credit types in your profile. A store's charge card is not the same as a credit card, credit cards are not the same as loans, just like automobiles are not the same as home mortgages. Think long-term and deliberately show your ability to handle various types of credit with increasing levels of funding by growing it with good payment history.

4. Increase Your Credit History

The longer your credit history, the better off your credit profile will look. If you have older accounts, don't close them. Holding older accounts open, with good payment history can help your score, but closing them could hurt your score.

5. Set Clear Financial Goals

Think about what you want to achieve with your credit score. Do you want to buy a car, rent or purchase a new home, consolidate debts, start a business, or simply get better rates. Whatever it is, we can help you develop a strategy and an implementation plan to achieve your goals.

6. Use Bacon Banking Tools

Take advantage of the tools offered by Benevolent Bacon, such as our consulting services, credit enhancement, financial tools, business building and funding services designed to help you start bringing home the bacon!

7. Stay Informed

Keep yourself updated on changes to your credit score and financial news. Benevolent Bacon often provides resources that can help you stay informed about what's changing and what's new. Banks are always adjusting their lending criteria and the credit bureaus (through the fed) are adjusting their reporting methods and scoring criteria. Bacon is your friend on the inside paying attention to these changes and standing by ready to help you where you need it.

8. Engage with the Community

Join the Benevolent Bacon community to share your experiences and learn from others. Engaging with like-minded individuals can provide support and motivation. Do you really want to take financial advice to build wealth from that broke guy you knew in high school, or from a community full of experience doing exactly what you're trying to do? The choice is yours...

Take the first step today by exploring Benevolent Bacon and see how it can transform your financial habits. Remember, a better credit score opens doors to new opportunities, so why not start today with a partner who wants to see you succeed? Start your Bacon journey now and watch your finances start to sizzle!