CREDIT MANAGEMENT 101

CREDIT can be a powerful financial tool when used wisely. To make credit work for you, it’s important to understand some basic guidelines to help you use it responsibly and to your financial advantage. Once you build your credit confidence, you will be able to make intelligent financial decisions and establish strong credit rating that can help you to realize your financial goals – whether it’s buying your dream home or obtaining a personal loan to start your own business.

To use credit in a smart way, following these guidelines:

• Know your credit score and review it at least once a year – This score is used by lenders, landlords and potential employers to assess your financial integrity. Obtain a copy of your credit score for a minimal fee by contacting TransUnion (www.transunion.ca) or Equifax (www.econsumer.equifax.ca).

• Pay off your credit card balance every month– Make it a priority to pay the maximum amount of your credit balance every month.

• Make your payments on time– Pay close attention to the due date of your payments since a history of late payments may affect your credit score.

• Shop around to find the best credit card that meets your financial lifestyle— Shopping around can save you money in the long-run and may even provide you with valuable rewards. The Financial Consumer Agency of Canada (FCAC) offers a useful credit card comparison table within the 'Credit Cards and You' section of their Web site as a resource for consumers.

• Pay attention to late payments, calls or letters from credit agencies, and denied or revoked credit-- These are all signs that your credit history may be in jeopardy!

Do NOT …

• Get into the habit of making only the ‘minimum payment’ due on your credit balance every month
• Open new credit accounts for the purpose of debt consolidation without closing existing accounts
• Obtain a new credit card to pay off an old one unless the rate is much better
• Dip into your savings to cover everyday expenses

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