Tuesday, October 26, 2010

If I'd Only Known - PASS week five

"If I'd only known then, what I know now." Have you ever said these words? Is there something you know now that you wish you had learned when you were a teen? I wish I had learned the importance of establishing credit. That wasn't something that even crossed my mind as a teen. Even as a young adult, I didn't consider its importance. When I got divorced, however, I found myself in a tough position. I couldn't even switch the cable bill to my name because I didn't have any credit. I had to start from ground zero. I applied for and received a credit card. I started using it for gas. Every time I have to fill up my van, I use this card. Then, when I get my statement at the end of the month, I pay the entire balance with the money I have in my budget for gas. A friend of mine whose husband suddenly died, found herself in a similar position because everything was either in her husband's name or both of their names, jointly.

Now, I'm not saying that no one ever taught me about establishing credit or setting up a budget. My parents probably tried to teach me, but the lesson never sunk in. And now, here I am in my forties, just trying to establish a little credit.

I'm teaching my teens the importance of credit as well. Not that I want them to have a credit card now, but it's not too early to start preparing them. I tell them that they need to have wise spending habits if they want to buy a house in the future. Banks won't loan them money for a house if they overspend and don't pay their bills in a timely manner. And even though my teens are not considering buying a house or even getting a credit card at this point in their lives, they can certainly establish wise spending habits now.

I am working with American Express on this project. As always, I'm writing my honest accounts and opinions.


Shannon said...

I work for a background screening company and you know what is worse than no credit.... bad credit. It is important to pay your bills on time as agreed with the payment company (you don't have to pay it in full each month to pay as agreed- just the minimum). This shows that you can handle money and make wise decisions. =)