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It's your Money by Mark Justice

For parents, grandparents and educators it is sometimes challenging to teach to youth the importance of getting and keeping a good credit score. Perhaps we should add this subject to the important list of things we discuss with our children as they go off to college and at other times.

Bad credit has a serious negative impact on young couple's financial ability to provide and prosper. Buying an auto, home or business is directly affected by a person's credit. Bad credit is an unwanted but constant companion.

As an example a person with excellent credit will get the financial institution's best interest rate while a person with bad credit will maybe be turned down or if able to get the loan will pay a much higher rate.

For instance if Billy Bob with excellent credit buys a $20,000 auto he might pay a 4.5 percent interest rate which will give him a $377 monthty payment while Julie Ann with not so good credit might pay 9 percent interest giving her a payment of $415 a month. Over the life of the loan Julie Ann will pay $2,264 more than Billy Bob.

Credit scores are used by prospective employers, landlords, insurance companies and many others to help them determine if they are willing to do business with you and at what rate. Responsible young people should have a checking account with debit card, a credit card, only one please, short term small loans and auto purchase in their name. All of these help a person establish a credit history.

My best kind and gentle advise to youth as they establish their own financial identities don't buy what you don't really need and pay your bills on time. Let me repeat that last part-pay your bills on time.

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