Why You Need To Retire With A Good Credit Score | The Better ...

The following post represents the guest author?s opinion, not Jemstep?s.

As young adults get their financial footing, many learn the hard way about the importance of good credit. As we settle down, purchase homes, and pay off our debts, it is tempting to assume that our hard earned credit scores are not as important now as they once were. Some may even conclude that their good credit was only valuable when they were looking to buy a house or finance new cars. In the absence of those needs, some feel that their credit scores are irrelevant to their future needs as they anticipate retirement. But in fact, maintaining a high credit score continues to be a wise practice, even when you aren?t planning to borrow money.

Credit scores are used for more than just credit

Appropriately enough, credit reports were once used just to determine one?s qualifications for being extended a new line of credit. But today, other companies have taken to using, or misusing your credit history too for many other purposes. Automobile insurance companies have begun to set rates, in part, based on driver?s credit scores. Their reasoning is that those who have excellent credit tend to make fewer claims. And while many argue that illness or job loss in one?s family can have an effect on your credit without affecting driving habits, the fact remains that insurance companies can and will adjust premiums based on your credit score. In addition, home owner?s insurance companies have started using credit scores to set rates as well. Finally, there are many companies that now require applicants to pass pre-employment background checks before making a job offer. Inevitably, these checks include running the applicant?s credit history. And while some sort of security check may seem appropriate for jobs in banking or government, the fact is that these types of checks are becoming common in nearly every industry.

Life happens

But what if you are not seeking a new loan, a new job, or you don?t even drive. Is it then possible to just disregard your credit score? Possibly, but I wouldn?t advise it. As too many people have learned, you just never know when you will be looking for a new job. Or more optimistically, perhaps an irresistible opportunity will present itself. Others might look to apply for a new credit card, if only to take advantage of ever increasing credit card bonus offers. In anyevent, maintaining good credit will be necessary to receive the best rates on home owner?s or even renter?s insurance. And finally, with credit scores being used for so many different reasons already, it is hard to say how your credit will affect you in the future. If current trends continue, there is no doubt that your credit will be more important in the future, rather than less.

By building and maintaining good credit before, during, and after retirement, you can be prepared for whatever life decides to throw at you.

Jason Steele is a freelance personal finance writer who specializes in travel and credit cards. He writes for CreditCardForum and several other top personal finance sites.

Source: http://www.jemstep.com/blog/2012/10/why-you-need-to-retire-with-a-good-credit-score/?utm_source=rss&utm_medium=rss&utm_campaign=why-you-need-to-retire-with-a-good-credit-score

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