One of my trade-mentors posted a video on his FB page from TED. It was a very inspirational video by Shawn Achor called The happy secret to better work. It is 12 mins long but well worth your time.
As I was perusing the site to find out more about TED I came across a video that ALL my girlfriends need to watch. It is about saving. It is about starting small and starting tomorrow. This is a concept that I have discussed time and again with some of you....take a piece of that pay increase every year and start savings. If you start with just 3% of your salary in year one, then in 4 years you will be over 12%. And here is the best part, you won't have to take from your current standard of living. So you CAN save and increase the savings. Here's the link: Saving more tomorrow. It is a 17 min video. You will get a lot out of it.
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Here's another question from one of my girlfriends: I have some derogatory information on my credit report and heard that it can be removed. Is that true?
The answer is Yes, But. If there is information on your credit report that is not yours then you have the right to contact the credit reporting agency asking them to correct the information. We, consumers, are protected by the federal Fair Credit Reporting Act (FCRA) which "promotes the accuracy and privacy of information in the files of the nation’s credit reporting companies." (quoted from www.ftc.gov)
The 1st thing you need to do is put in writing the information you believe is inaccurate. Include copies of any documentation that would further strengthen your position. Be sure to send the letter return receipt to confirm that it was received. The credit reporting agency has 30 days to investigate your claim. If there is no response or the company can't prove the information isn't accurate then the credit reporting agency MUST remove the derogatory information from your report. On the other hand, if the information is disputed by the company, the information will stay on your report for 7 years from the time it was reported as derogatory (when a company starts their "aging" clock will vary so this is an estimation). The further away from the original date the less the derogatory information will affect your report.
Here is a link to a sample letter on the FTC website: Sample Letter
As I just mentioned, derogatory information will fall off your report after 7 years, but that doesn't mean it will necessarily "go away." If that information is believed valid by the original creditor and it is an outstanding bill, it will have probably have been sent to a collection agency. The collection agency will have paid a small fee for your outstanding debt to the originial creditor. For example you owed XYZ $1000. You defaulted on said debt in 2002. XYZ finally got tired of calling you and sold the debt to ABC Collections for $200. ABC Collections will attempt to collect the $1000 but will negotiate with you.
There is a statute of limitations on collecting debt and it varies by state. Here's a good map Statutes of Limitations by State. As a caution, though, debt collectors can still attempt to collect "time-barred debts." It is up to the consumer to be vigilant. If a debt collector calls and you know the statute of limitations has run out do NOT have a discussion acknowledging said debt. This will RESTART the clock. Yep, that is right, the old debt will have a new date. This is called "re-aging." Should you be contacted by a debt collector always ask for them to send you information in writing. This will give you time to research the debt and the statute of limitations.
The other very salient point I must make is OPEN YOUR MAIL!! All of it. Read it. Don't bury it because it is bad news. You can be sued by a creditor and your ignorance of said lawsuit is no excuse.
Back to our example... You live in Indiana. It is now 2005 and ABC Collections is calling. They have the right to continue to attempt to collect the debt. You have the right to ask them to send you more information on the debt and/or stop contacting you. They may even sue you. It is their right. Let's say they do nothing and 4 years go by. Since it is 7 years since the debt was reported as derogatory it has past it's statute of limitations in Indiana.
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Things happen in life. Having poor credit is not the end of the world and it can be fixed. Trust me on this. I had horrible credit 20 years ago. I was sued and had a judgement against me. With vigilance I was able to pull myself out of that mess. I am determined to never be in that position again. The worst part of poor credit, to me, was the shame that goes along with it. And yes, poor credit will affect your ability to get a job, an apartment, a mortgage loan, etc. It is truly in your best interest to know what is on your report. I know I put this in a previous post, but it is worth noting again Annual Credit Report is the best link to access the 3 credit reporting agencies.
Good luck!
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