Ultimate Guide to Credit Scores and Credit Cards

Fixes for No Credit & Poor Credit; Ideas for Excellent Credit

-researched and written by Suzanne McConaghy

If you want more flexibility and money in life, then you must pay attention to your credit scores and credit cards. Check out this ultimate guide for people with all credit scores – perfect, excellent, good, fair, poor, or non-existent. Everyone, regardless of your credit status, will benefit from the info in this article. If you have good, excellent, or perfect credit, you’ll find a super easy and little-known way to make real money from your credit cards at the end of the article.

• Contents – Jump to:
• Check Your Score
• No Credit History?
• Poor Credit Score
• Get out of Credit Card Debt
• Good – Excellent Credit
• Credit Cards for Travel
• Lucrative Side Gig

NB: When you sign up for a credit card through one of these links, I may earn points for referring you. Thank you! – this helps me to continue operating this website and community for free.

Why Care about your Credit Score?

• Qualifying for a mortgage (you may be denied…or, pay higher interest if your credit score is not in the good to excellent range),
• Getting a job (most employers will run a credit check on potential employees),
• Renting an apartment (landlords use credit reports to see if you are financially responsible),
• Car Loan: your credit score will determine your interest rate for any loan (see graphic above).

Additionally, once you have good credit, you can get lots of free stuff! My credit cards give me statement credits every month for groceries, dining, airline fees, Global Entry, airport lounge access, shipping, and my cell phone service. And, I’m an avid traveler, so I have begun travel and credit card ‘hacking’ (which means that I use the credit card and travel industries’ own rules to gain miles and points in order to travel for free).

Why Credit Cards?

Many people are leery of using credit cards. If you know for a fact that you cannot control your credit card use, you may want to avoid them, because the interest rates are high. However, if you can develop the discipline and maturity to only charge what you can pay off each month, you will benefit in many ways. Using cash or a debit card is outdated and limiting; it means that you are leaving real money on the table.

Strategic use of credit cards can definitely boost your credit score.

How to Check your Credit Scores

Knowing your credit scores is important. 😊 Your credit scores will help to determine if you will be approved for a credit card or a loan, and sometimes, your interest rate. Once you know your scores, you will know whether it’s worth applying for a card for those with good and excellent credit history, or if you’d be better off considering the offers for low credit. (It can ding your credit to apply and not get a card.) It is good to check your credit report regularly to ensure that it is correct. There are services that give consumers a FREE credit score report with all 3 major credit bureaus instantly. Check your credit report carefully, to see what areas you need to work on. You can also dispute any incorrect information you may find there.

What if I have NO Credit History?

If you have little or no credit (perhaps you’re young, or have primarily used cash or debit cards), you will need to get some credit established. For example, my daughter didn’t have bad credit, just not much history. It was tough for her to start building credit, since she never had borrowed money for a student loan or a car. These steps will help:

1. First, ensure that you have a checking account and a savings account, either in a traditional bank or an online bank.
2. Secondly, small loans (that you can easily repay) are a good way to begin building your credit – but only if you make your payments on time! Find loans for people of all credit levels. There are loan calculators to help you determine the budget aspects of a loan.
3. Get a credit card that can help you build credit. When you apply for a loan or credit card, the issuing bank will check your credit history to be sure you’re a good risk – so what if you have limited or no credit history? Luckily, there are specific credit cards available to give you an opportunity to build credit. If you want to minimize the risk of being denied, consider a secured credit card – I’ve noticed that the banks have become extremely cautious during the pandemic, and they do not want to take credit risks with the US economy up in the air.

And, if I have Poor Credit? 😒

No one is immune to money troubles – most of us have been in a tight financial spot at least once in our lives. Perhaps you’ve experienced unemployment, a major illness, or divorce; paid late or defaulted on student loans, medical bills or other expenses – if so, your credit history may have suffered. But – no matter how far your credit score history has fallen, there is usually a way to raise it.

If you have limited or poor credit history, banks may require a refundable security deposit to act as collateral on your credit card account. (Think of it like a security deposit you’d put down on an apartment.) The bank protects itself while allowing you to build up your credit history. It’s a win-win situation. Here are some secured credit cards with the lowest fees and best terms for this circumstance.

An acquaintance of mine wasn’t even able to get a secured credit card from her own bank! She needed a “credit boost” to get started. If you need a credit boost, you can use a credit building agency like BNB Credit Builders. It costs money, but if you have no other recourse, it’s worth it to start amping up your credit history.

Debt, Collections, Bankruptcies, Judgements, other bad stuff…

If you need more than a “boost”: There are companies that can help with credit repair, consolidating debt, and debt counseling; here is one: Repair Your Credit.

How can I pay down Credit Card Debt and Increase my Credit Score?

If you carry a balance on a credit card, it can take decades to pay off your debt; credit card interest rates are ridiculously high, maybe 24-30%! With a no-fee introductory 0% interest rate offer for balance transfers from a reputable bank, you have the opportunity to pay off your balance much faster. Balance transfers are the best way to save money if you’ve accrued credit card debt – but the key is to take advantage of the 0% interest rate to pay it off completely before the 0% expires! Otherwise, you’ll be in a never-ending cycle of credit card debt.

Pro tip: You cannot transfer a balance between credit cards from the same issuer.

Do You Have a Good or Great Credit Score?

People ask me, “What’s the best credit card to apply for?” The real question is: “Which credit cards are best for you?” There is no one credit card for everyone, as credit cards have differing features and benefits. As individuals, we have unique goals. One person may need a credit card with a 0% intro APR in order to transfer a balance from another card after a big purchase. Someone else may prefer a credit card with cash back rewards, or with no Annual Fee.

With so many credit cards on offer, it can be confusing trying to figure out all the sign-up bonuses, loyalty programs, benefits, special offers, arcane rules, and hidden fees, but don’t give up! I can help navigate all of this.

Credit Cards for Travelers

Travel credit cards are a great opportunity to earn free points or miles that can be redeemed for airfare, hotel stays, or cash. In the race to get customers, credit card issuing companies partner with various travel brands that entice consumers with sign-up bonuses, loyalty points, special discounts, and more. Their desire to get you as a customer is really your gain.
By using their own systems and paying off your bill in full each month, you can get airline tickets, hotel rooms, and vacations for free!

Suz’s Suggestions for Travel Credit Cards

Here are some examples of what I look for in a good travel card:

• Carry cards with no Foreign Transaction Fees (FTFs). That way, you can use your cards overseas at no extra charge. (Pro tip: always request that you’re charged in the local currency to get the best exchange rate!)
• Airline Benefits: One of my cards gives me a $200 airline fee credit each year; another gives $100. Another paid for my Global Entry/TSA Precheck, and also Airport Lounge entry (no more paying for food + drinks at the airport!). Here are the best cards for travel hacking; there are some other ideas for airline mile accruals. Airline co-branded cards can give you free flights, a waiver for baggage fees, elite loyalty status, and priority boarding. Choose a card with benefits for the airline(s) you like and/or use the most.
• Hotel Benefits: There are a couple of hotel credit cards I opened recently which have phenomenal benefits. My favorite hotel card can earn you 12 free nights! There’s another that can result in many travel benefits, besides free hotel nights. Again, investigate card co-branded with hotels you enjoy.
• Other benefits of credit cards may include statement credits for shipping, dining, streaming, and cell service each month, and/or rental car insurance and purchase protection.
• Points: If you’re into collecting points, there are cards for accelerated points accrual.
• Sign-up Bonuses can get you a big slug of points or miles when you meet the initial spending requirements.

Want to Earn Real Money using your Credit Cards! 🤑 How? Credit Sharing…

My favorite, amazing side gig? If you know me, you know – it’s Credit Sharing. Forget the peanuts you make with Rakutan, Ibotta, coupons, taking surveys, and the time-consuming side jobs like DoorDash, Instacart, Uber – really? Do you have that much time and enjoy hassling this stuff? Or trying to sell something, finding customers, and spending money to do so? As they say in Brooklyn, “Fuhgeddaboudit!”

I’ve been credit sharing for about 3 years now; I heard about it from a physician I worked with. It takes less than 10 minutes per month, and my average monthly check has been going up steadily: from $100 in the beginning, to $360 for a long time, and currently, since this summer, I’ve been making an average of $1000 per month! Yes!! I’m excited!! Read this very detailed article about the credit sharing side gig; check it out and hit me up with any questions about it.

In Summary:

Wherever you are in your financial journey, I hope that you now realize that:

• Your credit score is important
• You can improve your credit score no matter where you stand now
• You can gain tremendous value by using credit card issuing companies’ own rules and strategies
• There are many benefits for travelers to strategically open specific cards
• You can earn a great income using your existing cards for credit sharing

Questions or comments? Other suggestions? I love learning more about personal finance, and would enjoy hearing your personal strategies!

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