For the average American consumer, managing your credit can be difficult. Add military personnel to your resume and imagine the stress deployment can cause on your finances. Being in the military can mean constant movement and deployment, making it difficult to pay your bills and watch over your credit responsibly. When deployment is over, transitioning back into everyday life can result in financial challenges for most veterans along with the physical, emotional, and mental stress that ex-military deal with.
Focusing on your mental health as a veteran can mean neglecting your financial health. In recent financial studies, it was found that over half of all veterans carry debt every month, an amount almost double that of a non-veteran consumer, and a third of all veterans have exceeded their credit limit and been sent to collections. Poor financial responsibility results in a less than average credit report and an unsatisfactory credit score, which in turn means paying higher interest rates. In an effort to help struggling veterans with their credit and aid in improving their finances in the future the following tips can help veteran consumers achieve their goals.
1. Download Your Credit Report
First and foremost, order a copy of your credit report. Your credit report is a summary of your financial history. If you don’t know where you stand financially you cannot work towards improvement. Under the Fair Credit Reporting Act (“FCRA”), consumers are entitled to one free copy of their credit report annually from each of the three big credit reporting agencies. You can order a copy of your report from AnnualCreditReport.com.
2. Understand Your Credit Report
Next, once you have your report, obtain a better understanding of how to read it and how to improve it. Grasp a better understanding of what is included in your report and how it affects your score. Your credit score consists of five different factors each contributing a different percentage to your overall score. Determine where you are deficient and what you need to improve upon.
3. Avoid Credit Scams
Third, avoid credit scams. Those in a financially difficult position often fall prey to scams. Look out for quick fixes to your credit and loan offers that seem too good to be true…because they probably are. Scam artists are looking for vulnerable consumers like veterans who are in need of a quick credit fix.
4. Take Advantage of Military Approved Banks and Credit Unions
Fourth, veterans should choose to apply for loans from banks and credit unions that are military approved. Military-friendly banks are designed to help veterans by offering lower interest rate loans and special benefits to people of service, a great way to help manage and save money.
5. Draft a Budget Plan
Lastly, veterans looking to save money and improve their credit should draft a budget plan. Budget plans do not have to be complex. Try making a list of all expenses and put them in order of importance. Figure out where you can make larger payments to bring down interest rates and save money over the life of the loan.
If you are in need of financial advice or believe your rights have been violated under the Fair Credit Reporting Act and would like the advice or assistance of counsel, contact SmithMarco P.C. for a completely free case review.