How to be the best (financially) you can be...

February 28, 2017
Marvin Coleman

"Be the best (financially) you can be" is easy to say, important and not that hard to do.  Having your ‘financial self’ in tip-top shape will mean you're in the best position to achieve any financial goals you’ve set – whether it be to pay down accumulated debt, purchase a new car, or enter the property market for the first time.

 

Get financially fit

A good place to start is by getting your credit history into shape. This can be as simple as paying bills on time and maintaining regular repayments on any current loans or credit cards.  If you do miss a payment, fix it quickly and keep a 'note to self' of what happened and why.

There are a number of other steps you can take to ensure your credit history is where it needs to be, so you can achieve your future financial goals with fewer obstacles.

  • Don’t close accounts for the sake of it:

You may think that it's beneficial to close old banking accounts that you no longer use, but closing these accounts can actually impact your credit score.

Why? A portion of your score depends on the length of your credit history. A long credit history can be considered beneficial, so long as they have been serviced adequately. Keeping old accounts open helps to make your overall credit history as lengthy as possible.

  • Be careful about taking on new debt:

Applying for a credit card or loan is an activity that is reflected on your credit history report.

Why? Too many applications in a short period of time can have a negative impact on credit history. Opening many new accounts can also make it more difficult to manage your credit. Only apply for credit when it is absolutely necessary.

  • Mix it up:

It is always a good idea to maintain a good mix of credit.

Why? The reality is, some lenders like to see a mix of credit types to ensure that you can handle different types of credit. Mortgages, car loans, credit cards and personal loans are all different types of credit.

 

Enlist a coach to help you achieve your goals

As with any change program, sometimes it’s tough to get started – and then to stay on track. That’s where a professional coach can step in to help you work out a program that’s suited for you, and then regularly check in with you to make sure you continue to stick with it.

In my Oakleigh office, we have Mortgage Choice Financial Adviser Patrick Jong available to act as a ‘coach’ for your money.  He can work with you to develop a plan tailored to your needs with a range of strategies suited to your goals and circumstances.  He can then help you stay on track – with either formal or informal reviews - and fine tune your plan if necessary.

As ever, please don't hesitate to contact me with any comments or questions.

Cheers, Marvin Ph 0431 376 008

Posted in: Financial planning

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