Your Money, Your Future

Good Credit is Key to Solid Financial Future

ICBA and TEXAS BANK Offer Tips for Establishing and Maintaining Good Credit

When establishing financial fitness goals, the Independent Community Bankers of America and TEXAS BANK want to remind customers: it’s easier to build a credit score than to repair a bad one.

Having a good credit history is key to any financial plan. Credit scores take into consideration years of past behavior, so it’s important to establish a history of responsible credit practices and build your score by maintaining good habits.
ICBA and TEXAS BANK offer the following tips to help build and maintain good credit.

• If you are just beginning to establish your credit history, open a checking account and keep careful track of your balance.
• Use debit and credit cards for convenience and safety, but not to overspend. Missed or late payments damage your credit and hurts your credit score.
• A good mix of credit (i.e., a revolving credit line and an installment loan) also boosts your credit score and further demonstrates that you can manage different types of credit.
• Demonstrate stability in the three to six months before a major purchase. Avoid opening or closing accounts or moving large amounts of money around.
• Build an emergency fund equal to at least six months of living expenses. If the unexpected happens, you will still be able to pay fixed expenses instead of falling behind.
• Alter your credit focus as you approach lifecycle stages. As you near retirement, for example, start paying down major purchases (such as a mortgage).
• Monitor your credit regularly so you can correct any errors and detect any potential signs of identity theft. Order a copy of your credit report annually from www.annualcreditreport.com.

“Establishing good spending and saving habits, and sticking with them, is critical when times are tough and can go a long way toward helping you achieve your financial goals,” said Scott Heitkamp, ICBA chairman and president and CEO of ValueBank Texas in Corpus Christi, Texas. “Your local community bank can serve as a great resource to help get you started on the road to establishing good credit, which will serve as the foundation for a more secure financial future.”

About ICBA
The Independent Community Bankers of America®, the nation’s voice for more than 5,700 community banks of all sizes and charter types, is dedicated exclusively to representing the interests of the community banking industry and its membership through effective advocacy, best-in-class education and high-quality products and services. For more information, visit ICBA’s website at www.icba.org.