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Senior Citizens Need Good Credit

No matter how old you get, sooner or later you will need to get a loan or buy something on credit.

Even though older people tend to have good credit scores, some of them let their credit get bad because they think they won't need it in their later years. This cannot be any further from the truth. Even as you get older, your credit makes a big difference in your life so it is a good idea to keep your score as high as possible.

A high credit score is important no matter how old you are, but as you get older, good credit takes on a whole new meaning, especially after you retire. You will have to learn to live within your means and in a sense, your good credit may become your lifeline.

When you retire your income drops substantially from what it was while you were working so many of the things you could qualify for with your income then, especially big ticket items, may become harder to buy. A high credit score may help give you more purchasing power.

Just because you are a senior citizen doesn't mean you won't have to buy things to live on. You have to think long term retirement because you may live to be 100 years old or older and want to maintain an independent lifestyle.

Independent living means having a place to live, food, and transportation. You may need to buy a car, a new refrigerator, a new washer and dryer, and/or other items that you may not have the money to pay cash for. If you don't have cash, you will need to have decent credit.

Eventually, you may want to buy a smaller home, get a reverse mortgage, or rent an apartment. You may be asked by a child or grandchild to co-sign for a car or something else. You may need to get a new cell phone or new mattresses for your bed. These things require a good credit score.

One of the first things people think about doing when they retire is close credit card accounts that they don't use or ones they feel they don't need. This seems like the right thing to do, but maybe not.

It's a good idea to keep at least one or two credit card accounts open and you should use the cards at least once every twenty four months so your payment data gets reported to the three main credit reporting agencies, Experian, TransUnion, and Equifax.

Credit reporting agencies look more favorably on accounts that you've had for a long time over those you've had for shorter times. It may be of greater value to you to keep the older accounts active because it shows that you have a long term credit history and you make your payments on time.

  • By paying off the balance after every purchase you make, you can avoid incurring interest on your credit cards.

Your credit says a lot about you so keeping your credit score in good standing as you get older can help you stay financially fit long after you retire.

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