Thank you Lexington Law Firm for sponsoring this post. Lexington Law Firm’s team understands that a credit score is not just a number; it’s a lifestyle.
Growing up, I had no idea how much credit would affect my life. I saw my parents stress over money from time to time. There were instances when I knew we didn’t “have it” like that. As an adult and a mother myself, I realize that a lot of these money issues were due to either bad credit or not a proper understanding of credit. Thankfully, my mother began to actively work on her own line of credit and when I moved into my first apartment at twenty one, her credit score was in the high 700’s and she made a favorable co-signer for me.
When I became pregnant with my daughter at twenty three, it was a reality check in many aspects of my life. I knew I had to fix my credit and clear any outstanding debt. Who knew what struggles parenthood would have for me and I did not want to find myself in the position of being stuck or not approved because my credit score was beyond dismal. Back then, I did not have any knowledge of credit repair companies and went through the long and stressful process of fixing my credit on my own. I did it but it was an additional stress I did not need during my pregnancy and I was going into the process ill informed.
Motherhood brought a new form of responsibility to my life. I knew that I had obligations not just to myself but also to my daughter. Last year, I chronicled my experience of fixing my credit with Lexington Law on the blog so that my credit would be in an optimal position to buy a house. On IGTV, I also shared how I refused to let credit take away my freedom to enjoy life. I still deserved to travel, go out to eat, and most especially enjoy time with my daughter. By fixing my credit, I became more available to her without the constant worry that every move I made would dent my credit score.
Trying to repair my credit in my early 20’s versus repairing my credit now working with Lexington Law was also different because the credit repair industry has changed so much in the last ew years. There was a lot of fiction and miseducation about certain debt not being able to be removed and through Lexington Law I learned about different acts like the Fair Credit Reporting Act which states that all information reported to the credit bureaus must be accurate and the companies bear the responsibility of proving my debt.
Working with Lexington Law this time around brought many benefits to my life as a mother. Knowing what I experienced growing up, I knew I did not want my daughter to go through the same pitfalls of not understanding credit. Lexington Law is the oldest and most respected name in credit repair and one of the key benefits of working with them was learning a comprehensive way to actually learn about credit in a way that I could teach my daughter. Even though at seven years old she is too young to understand a credit report, she can understand credit utilization.
A great lesson I learned through Lexington Law was the 30% utilization rule when it comes to credit card usage. No matter what your credit card limit is, the best way to keep your credit score in the positive, is to never spend over 30% of your available credit. For my daughter, I broke down this information in terms of money. I told her, if she receives $10 in allowance, she wants to only spend up to $3 at a time. The more her allowance savings increase, the more she can spend. Her utilization amount never goes over 30% but the more her funds increase, the more she can spend.
Through my Lexington Law app, I was able to successfully track my credit score over the last year and watch it rise. I started this process a bit stressed and very frankly put, uneducated about how my credit report was calculated. I walked away from the situation with more freedom, a credit card that was recommended for my score, knowledge to pass on to my daughter, and am working the steps towards being in the position to purchase my first home.
My job as a mother is to break generational curses. The days of bad money management are far behind us. What are some ways that you are working to teach your children about better credit?