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4 Ways to Improve Your Credit Standing and Financial Reputation

4 Ways to Improve Your Credit Standing and Financial Reputation
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Monday, 10 September 2018 08:34 AM Current | Bio | Archive

Life can be devastating when your financial situation is in shambles. Imagine your business going at a snail's pace and it’s somewhat difficult to make ends meet.

Taking loans to deal with pending issues become inevitable. Invariably, years of acquiring debt have serious consequence on your credit score, especially when you’re not diligent in paying off loans or debt you’ve acquired.

What do you do in situation like this? Do you just sit back and feel like it’s the end of the world? Do you feel you can’t improve on your credit score to get new loans?

If you find yourself in this mess, here are 4 tips to improve your credit standing and financial situation:

  1. Re-evaluate Your Investments

When a business has failed several times despite taking many loans to revive it, don’t you feel the need to re-evaluate such a business? When your take-home pay is stretched to the extent that it gives no room for savings, don’t you feel you need to invest to supplement your salary?

Part of the problem we have is trying to revive a business that can’t be saved or wishing for a salary increase to meet a growing list of financial challenges. The truth is that you need to invest wisely if you want to improve your credit standing. You have to diversify your investment portfolio to improve your financial situation. 

  1. Be Mindful of Your Spending

Whether we believe it or not, our credit standing and financial situation are dependent on the pattern of our spending. In business, when expenditure exceeds income, it will result in a loss. This is also applicable to salary earners: when your expenses exceed your income, there’ll be nothing to save.

What you spend your money on matters a lot. You need to be conscious of your expenses by categorizing your expenditures into a necessary and not necessary list. Download an expenses-tracking app to help you document your daily, weekly, monthly and yearly expenses.

Having an idea on what you spend the most on will help you adjust and weed out the items in the unnecessary list. When expenses are on check, your credit standing improves.

  1. Restore Your Credit Standing

Don’t sit back and feel there’s nothing to do to restore your credit standing. When you’re in a financial mess and your credit standing is negative, you need to put in adequate effort to restore yourself. Ask vital questions and meet people who will guide you to make sound decisions.

It’s very easy to learn anything these days. Just log onto the internet and get the information you need. At this level, what you should learn about is money management, credit repair, investing, passive income, and other basic financial ideas that can make a huge impact on your personal finances and, by extension, on your credit restoration efforts.

  1. Understand the Concepts of Asset and Liability

Having a clear knowledge and consciousness of the concepts of asset and liability will go a long way in improving your credit standing and financial situation. Before you purchase an item, apart from food and other necessities of life, you need to ask yourselves about the value and benefit of such item. Assets add while liabilities subtract.

Spending habits is one of the main causes of bad credit scores. We should learn to buy more of assets than liabilities. Don’t get unnecessary luxury items when you can invest in real estate and other productive businesses. Be content with what you have and only buy what you really need. Your credit standing and financial situation can be improved if only you are disciplined and conscious of it.

Richard Agu is a researcher, entrepreneur and freelancer, passionate about entrepreneurship and self-development. Currently, Richard writes for Entrepreneur.com, Goodmenproject.com, among others. Follow him on Linkedin.com by clicking here now.

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The truth is, there’s absolutely nothing we can’t achieve except we have the courage to pursue them. If you find yourself in this mess, here are 4 tips to improve your credit standing and financial situation:
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Monday, 10 September 2018 08:34 AM
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