I’m 27, I have no financial literacy, my credit score is in the 400’s and I need to move in the next six months. I live with my sister, who’s credit score is also not great, I’m a disabled veteran in college so my income will increase come October. I just don’t know what to do to improve my credit score, the obvious answer is to pay off debt that I accumulated at 18 but I haven’t made payments on it I’m years is it too late?
Help! I’ve been an uneducated idiot my whole adult life
byu/Dearly_Disappointed inpersonalfinance
Posted by Dearly_Disappointed
14 Comments
Credit Building: https://www.reddit.com/r/personalfinance/wiki/credit_building
Start by laying out some numbers for us.
1. What’s your monthly income? What will it be come October?
2. How much debt do you have and what are the interest rates?
3. What are your recurring expenses? (And I mean everything, not just essential bills. Any subscriptions, etc.)
4. What caused you to go into so much debt and have you resolved that issue?
How much do you owe?
To start improving your credit, you need to start making payments on your debt. It doesn’t have to be paid off, though that is ideal. If your loan/credit cards are delinquent, your credit score is alway going to be in the trash.
Id consider bankruptcy, just take the hit and move on
You definitely want to check your credit status on all the official web pages like Experian etc, that you’re not missing a debt that has been forgotten and slowly bleeding you score.
If anyone does a credit check, a 400 is a “no.”
You should contact veteran and/or social services about some help with housing and credit. Your debts may already be legally discharged after the 7 year mark. If not, yes, paying them raises credit… that’s what credit ratings are for.
Someone would need a lot more detail to help you, I’m afraid.
Dave Ramsey on YouTube has callers with scenario like yours. Worth looking into.
It’s never too late, as long as you’re above the ground. You’re still fairly young so if you put your mind to it you might be surprised how quickly you can sort this out.
Read the book,”The Richest Man in Babylon” it breaks down how to take care of your money, debts, investments, and spending habits. It’s written so that a middle schooler can understand it. In plain English. It’s a book that really opened my eyes.
You build financial stability and credit during the times in your life when things are normal. It’s a set of long-term habits because they work slowly, but inexorably, like glaciers.
There’s no crash program to do it right before, or during, a move. Especially a forced move. Fast life changes don’t improve your financial stability, they reduce it. Sudden increases in income are as destabilizing as sudden decreases.
What state/country are you in?
Debt from when you were 18 should have fallen off your report by now if you’re in the US.
Does your college have any student housing designed for adults?
Do you have a few hundred dollar to put towards a secured credit card? They are a good ‘starting from the bottom’ credit builder.
It generally takes more than six months to fix a credit score that has really old debt. Can you look into roommate situations? Someone recommended veteran services groups which would be a huge help for you as well.
Start following Call to Leap on Instagram, he has some good videos
Dispute everything and if it doesn’t help it doesn’t hurt and if so much that it’ll take years to fix might as well file right after you sign a lease