March is Credit Education Month, so it’s probably a good time to ask yourself: how much do you really know about your credit score? When asked in a 2006 Consumer Action study, over 27% of Americans said they had never even checked their credit. What’s worse is that a recent FTC report revealed that about 25% of American consumers have at least one error on their credit report that could negatively affect their score.
So what exactly is a credit score? A credit score is a numerical value given to summarize a person’s creditworthiness, and is generally sourced from information on your credit report as provided by credit bureaus. Your credit score ultimately allows you to apply for loans, credit cards, apartments, and more. This score not only determines whether or not you qualify for a loan, but also the interest rate and credit limit for the loan. To put it simply, your credit score is a major player in your financial life. Having a lower credit score is indicative of being a higher risk to these lenders, thereby reducing the chances of being approved for a loan or credit card. However, your score can be incorrectly calculated due to errors on your credit report; these errors can result from identity theft.
Fortunately, services such as our own IdentitySmart can help you actively monitor your credit and protect yourself from identity theft. Besides providing you with $1 million identity theft insurance, IdentitySmart also actively monitors your credit report 24/7 and alerts you immediately when changes occur. You can also learn more about protecting your identity in our Privacy Education Center.
In celebration of Credit Education Month, PeopleSmart has put together an informative graphic to help highlight the importance of being both aware and educated about your credit. Please share this with your friends and family or on Facebook and Twitter to help educate others on the importance of credit education.