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Get Smart About Credit Day

National Get Smart About Credit Day on the third Thursday in October promotes learning about good credit every year. This day is part of the Get Smart About Credit (G.S.A.C.) program. In 2003, the American Bankers Association (ABA) Education Foundation originated this National Day where volunteer bankers help teach young people about credit habits. This year it falls on October 20. 

What is credit?

Credit has many different facets to it. Essentially it is the amount of money that you’re allowed to borrow from any lender or lending institution. When you enter into an agreement to borrow the money you will have to pay the money back over an agreed period of time. During this time, you incur additional fees and interest. Penalties for late payments can be applied and rates can change. This is how they make their money. Credit can also have a score attached to it and that is your borrowing reputation. This is worked out through a look at your overall spending patterns and repayment history. The lender then figures out your risk factor to them and that in simple terms is the basic way your score gets worked out. 

Understanding credit means that you have more access to accessible funds. That also means that you are in control of your money. Being in control of your money gives you control of your life. When used responsibly credit can be a real boon to either an individual or a family having access to fast easy cash can solve several problems in the short term as well as provide you with access to a lifestyle that you would not otherwise easily achieve. Being able to buy a vehicle for cash is not easy. Purchasing a home or property is not achievable for most Americans without some sort of mortgage. However, the keyword is responsible. Ending up with a mountain of debt is an incredibly bad plan especially if you are looking to have a secure financial future. 

“Make sure you keep track of all your spending and the amount of debt that you are in at any given point”, says Richard Eden Senior vice president of David Lerner Associates, “ Understand what your repayments will be and what they might become. The more you spend, the higher your repayments. You have to consider interest rates and whether they will fluctuate.” 

Responsible management of your debt and credit is essential or you will find yourself stuck in financial hell. Make sure you are smart about credit. There are tools and resources available to help you improve your credit score. Learn as much as you can about how to stay on top of your credit score and maintain it. Share your experiences and tips using #GetSmartAboutCreditDay to post on social media.


IMPORTANT DISCLOSURES

Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. 

Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable– we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC

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