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Practical Ways to Overcome Credit Hurdles

Good credit/bad creditLife situations factor into your credit issues. A divorce, illness or death can impact your ability to make monthly payments. If you default on your bills and your accounts become 30 days past due, creditors will report the lateness to the credit bureaus. Once this information hits your credit file, your scores will drop.

These events are unfortunate and often beyond your control. But these are not the only causes of credit issues. Sometimes, the underlying cause is preventable. For example, living above your means may result in relying on credit cards to get by each month. If you have a shopping problem, you may use credit cards to buy things you don’t need when cash is unavailable. And if you’re bad at organizing your finances, you may forget about due dates or misplace bills, which also triggers lateness.

Credit is nothing to play with, as your history and score can determine whether you get a mortgage loan, an auto loan or qualify for other types of financing. For this matter, you need to take your credit seriously. While you’ve probably heard this kind of advice before, it’s seriously enough that it bears repeating: there are simple ways to fix your credit issues and get back on the right path.

1. Create a budget

If you don’t have enough in checking to pay your credit card bills, this can result in late payments. However, if you were to create a budget and reevaluate how you spend your money, you may realize that there’s more than enough income to pay all of your bills.

Budget is an ugly word since it implies restrictive spending or frugality. But if you learn how to love this word, you may notice a drastic improvement in your personal finances. And the best part, creating a budget is not difficult. It’s all a matter of calculating how much you bring in, and then subtracting monthly expenses from this figure.

To begin, write down all your essential monthly expenses, such as housing, utilities, debt payments, transportation costs and other recurring costs –  such as child care and insurance. Calculate the total of these expenses, and then subtract this total from your net income.

This helps determine your disposable income after paying all recurring expenses. From this number, you can assess how much to allocate for extras, such as groceries, entertainment and miscellaneous expenses.

2. Repair your credit report

Perhaps credit issues aren’t entirely your fault, but caused by errors on your credit report. It is important that everyone checks their credit report at least once a year and dispute errors. But even if you dispute errors, there are no guarantees that the credit bureaus or your creditors will remove misinformation in a timely manner. This can be frustrating, especially if you’re trying to buy a home. But help is available.

In this situation, it’s beneficial to work with a credit repair company. These companies are not miracle workers, therefore, they are unable to remove legitimate negative information from your report. But if there are errors, and if you are unable to resolve these issues yourself, working with a reputable company can clear your credit file faster.

There are a variety of companies available, and choosing the right one can be tricky. For this matter, make sure that you thoroughly research a company. Read credit repair testimonials and reviews, and schedule a phone consultation to ask questions.

3. Get organized

Sometimes, fixing credit issues is simply a matter of getting organized. Rather than let your mail pile up, open credit card statements and other loan statements as soon as they arrive.

Using your phone or computer’s calendar, write down each due date including the amount owed. Also, don’t wait until the last minute to pay a bill. Aim to pay bills as soon as they arrive, or at least a few days before the due date. If mailing in a check, send the payment at least seven days before your due date.

Credit issues can affect your personal and financial life. However, if you adopt better credit habits, work with a professional and learn how to organize your finances, you can slowly improve your score.

 Image: Freedigitalphotos.net/Miles

About Kim Parr

Kim Parr is a private practice optometrist, freelance writer, and personal financial blogger. You can follow her journey to 20/20 financial vision at Eyes on the Dollar.


  1. It is a great article. Many people don’t realize that their credit score affect many things including auto insurance rates. Bad credit can prevent you from getting a mortgage or a loan. Even you have one, you may have to pay higher rates. If you are serious about your personal finance you have to keep an eye on your spending and credit history.

  2. Thanks for sharing your tips Kim, I was really suffering credit hurdles and I think this article can help me. Love reading this.

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