Heidi Gollub started Free Fun in Austin as a creative outlet in 2010, when she was ten years into being a stay-at-home mom and still had two little boys at home. She’d take her boys on a new adventure every morning and write about it in the afternoon when they were napping. Gradually, she started […]
The post Is It Time to Sell Your Blog? – Interview with Heidi Gollub appeared first on The Work at Home Woman.
If you believe everything you read about your credit score, you’d think it was the most important component of your financial health. Without a good credit score and history, the experts say, it’s more difficult to qualify for a mortgage or car loan – and more expensive, too, because you won’t get the best interest rates. In many states, bad credit can even raise your insurance premiums, cost you a rental apartment, or make it harder to get hired.
While all of that is true, it doesn’t tell the whole story.
First off, there are several credit scores out there. While it’s important to nurture your credit scores by using credit responsibly, your FICO credit score could be different from the one VantageScore reports, and lenders may use a different one entirely — so obsessing over one score can be a fruitless exercise.
More importantly, as Dave Ramsey famously notes, your credit score is not a measure of your financial health at all. “All it tells you is whether you are good at borrowing money and paying it back. That’s it,” says Ramsey on his blog.
Think about it. There are few ways to build credit without borrowing money. While your credit is undoubtedly important — especially when it comes to achieving certain life milestones, like buying a home – your credit score doesn’t necessarily dictate whether you’re “good” with money or wealthy at all.
With that in mind, I stopped caring about my credit score a few years ago. I do track my score and new accounts opened for free on Credit Karma, but that’s mostly just to prevent fraud and identity theft – not to judge my score.
Here’s why I just can’t care anymore:
FICO, the most popular credit scoring agency, uses several weighted factors to determine your credit score, including payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%). Believe it or not, these rules make it so you can be penalized for becoming debt-free!
My husband and I have enjoyed steady credit scores above 820 for a while now. But when we paid off one of our rental properties earlier this year, we both saw our credit scores drop by 20 or more points. The sudden drop took place because we paid off a 15-year loan and reduced the average length of our credit history tremendously. In other words, because we paid off and closed a line of credit, our scores took a hit.
That’s a racket if I’ve ever heard one, and yet another reason I refuse to worry when my score fluctuates. I would much rather be debt-free than keep my credit score hovering in the 820 range.
Taking that one step further, I refuse to let my credit score dictate our financial lives. If I had been overly worried about my credit score, I may not have worked so hard to pay off our rental property early. Perhaps I would worry about prepaying our home mortgage as well, and quit making extra payments there, too.
At the end of the day, I know what’s best for my family — and it’s not carrying around a bunch of debt for the next 20 to 30 years. So, I say to heck with my credit score; now that one of our rentals is paid off, we’re working hard to pay off our primary residence and our other rental as quickly as we can. If our scores drop when we pay off our primary residence, so be it.
Admittedly, I realize it’s easier to ignore your credit score when it’s a good one. A lot of people might question what I would do if my credit score took a sour turn once we become entirely debt-free. What happens if I need to finance a new car, for example?
The thing is, I have zero intentions of borrowing money ever again. If I don’t have the cash, I can’t afford it… period. That rule applies to vehicles, vacations, home remodeling projects, and any other expense you can dream up. And really, I would rather drive a skateboard than have a car payment ever again.
While you should pay special attention to your credit score if you plan to buy a home, those of us in our forever homes may not need to worry too much. We’re in the home we plan to raise our children in, and we now owe a lot less than half our home’s value. As a result, we never plan to move. And if we do move in the very distant future, we should have the cash to pay for our new home in full.
When it comes to maintaining debt freedom, having a healthy emergency fund has been huge for us. While the size of our e-fund ebbs and flows based on our earnings and the time of the year, we frequently have more than six months of cash expenses to use in emergencies.
Because of our emergency fund, I don’t need a boatload of credit at my disposal. I use credit cards to earn rewards, but we’d be fine if our accounts were cancelled for any reason, including lack of credit or a waning score.
To qualify for the best rewards credit cards, a home mortgage with the lowest interest rates, or personal loans with the best terms, you usually need a solid job history and income, a record of responsible credit use, and a FICO score of 720 or above.
You know what you get for a FICO score of 800? Or 850? Honestly, not a lot more.
When it comes to your credit score, there’s a point of diminishing returns. While earning and maintaining a good credit score is absolutely a smart move, there’s no award for a perfect FICO score – no cookie, no trophy, no nothing.
Your credit score is important – especially when you’re first starting out. But once you’re fairly established financially, it’s much easier to see credit for what it really is. As Ramsey says, your FICO score is nothing more than a measure of how well you borrow money. That’s why it’s possible for people with mountains of debt to still have extremely high credit scores.
As for me, I just can’t care about my score anymore… and I refuse to play the game. While an 850 FICO score is something to be proud of, I’d rather be wealthy and debt-free.
Holly Johnson is an award-winning personal finance writer and the author of Zero Down Your Debt. Johnson shares her obsession with frugality, budgeting, and travel at ClubThrifty.com.
Related Articles:
How much attention do you pay to your credit score? Do you think it’s important?
The post Why I Quit Caring About My Credit Score appeared first on The Simple Dollar.
The freelance writing life is wonderful, but it’s not easy.
You’re a business of one, responsible for marketing, writing and invoicing, as well as paying your bills each and every month.
Here at The Penny Hoarder, we have plenty of information about becoming a freelance writer — and even lists of websites or blogs that pay — but what about earning more from your writing?
If that’s something on your mind (and if you’re a freelance writer, it probably is), here are seven free sites that will help.
The first tool you need to arm yourself with? Knowledge.
And there’s no better to place to learn the ins and outs of freelance writing than The Write Life. It has information on everything from getting published to blogging, but its freelance writing coverage really shines.
Start with a post like How This Freelance Writer Made Six Figures in 2016, or check out its ebook Get Better Clients and Earn More Money.
One of the toughest parts of freelance writing is figuring out what editors want. And though no site is a crystal ball, Beyond Your Blog comes pretty close.
Offering articles, lists of writing opportunities and a Facebook group, it’s an all-around excellent resource for freelance writers.
Best of all, founder Susan Maccarelli often interviews editors from major websites to find out what they’re looking for from freelance writers. It’s a wonderful peek behind the scenes that will help fine-tune your pitches.
And when more of your pitches get accepted, guess what? You make more money.
If you don’t have a freelance writing portfolio yet, it’s easy to create one with Contently.
But your Contently portfolio won’t only be a repository for your previous work; it might also be a way to get future work. The platform works with brands that need content — and relies on its network of freelancers to create it.
When editors have projects for which they need writers, they search through the profiles of freelancers. So be sure to include your specialties in your profile, as well as the phrase “available for freelance assignments.”
Although I don’t depend on the platform for regular work, it’s always a nice surprise when an invitation to pitch a new Contently client appears in my inbox. And because the clients are national brands with big budgets, the assignments have paid crazy well.
Don’t waste your time pitching an outlet that pays pennies — target ones that understand what good writing is worth.
Here to help is the crowdsourced database Who Pays Writers.
Just log on and type in a publication.It’ll bring up reports from other freelance writers: how much (and how quickly) it paid, plus whether they had an existing relationship with the editor and how much reporting was required.
Pitching outlets that pay more is a surefire way to increase your freelance earnings over time.
Although it recently changed, FreshBooks is still my favorite online bookkeeping tool.
I first fell in love with the platform because it allowed you to invoice your clients via Paypal — and it only took out a 50-cent fee. In the new version, that option’s no longer available; your clients can only pay via credit card, and the platform charges fees similar to Paypal.
But, here’s a little-known secret: If you already have a FreshBooks account, you can revert to the Classic version just by following these instructions. If you’re signing up for the first time, you’ll have to contact customer service to try Classic.
Whichever version you use, don’t forgo the option to track your time. Even if your hours aren’t billable, knowing how long projects take is a vital part of setting rates as a freelancer.
Does the thought of doing your freelance taxes keep you up at night? I know the feeling.
That’s why I love reading Carrie Smith’s blog Careful Cents. As an accountant who later became a freelance writer, she’s been on both sides of the game. On her blog, she offers tons of helpful advice for managing your finances and making more money as a freelancer.
She even has a free mini-course called No More Job Boards that’s all about landing better-paying freelance work.
A few other sites that deserve an honorable mention? Writer’s Weekly, Make a Living Writing, The International Freelancer, Funds for Writers and the goodies on this resources page.
Work smarter — not harder — and the freelance writing gods might just reward you with an income you deserve.
Susan Shain is the founder of Where to Pitch, a free resource that helps freelance writers figure out where to pitch their stories. Just type in a publication or topic, and it’ll suggest similar outlets. Pitch smarter, not harder!
This was originally published on The Penny Hoarder, one of the largest personal finance websites. We help millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. In 2016, Inc. 500 ranked The Penny Hoarder as the No. 1 fastest-growing private media company in the U.S.
