Will Being in the Military Improve Your Creditworthiness?
The men and women in uniform who proudly serve our country have earned both our gratitude and our respect. But does that mean being in the military will improve their creditworthiness?
In a word, no. However, active duty military service does offer a benefit most of us would envy. Namely, it is one of the most secure jobs around.
In order for anyone to develop good credit, they need to have a creditor extend their trust. However, without a credit history, this can be difficult.
As a member of the military, you have the advantage of a steady income, which can look very attractive to many creditors.
Of course, this can also mean you get bombarded with credit offers from all sides.
Where do you begin improving your creditworthiness?
One of the best ways to start is by opening an account with one of the service members-only institutions, such as the USAA.
By having your pay deposited directly into one of these accounts, you can then take advantage of a credit card that is secured by your income.
In this way, you can establish a credit history without having to pay the normally high interest rates that are often charged.
To take advantage of the benefits that having a solid and secure source of income can provide, you need to be very careful about the kinds of credit you take on, as well as the level of debt you acquire compared to your income.
“If you are responsible, military
service can benefit your score.”
This is perhaps the most important lesson new service members can learn.
After establishing a history of using and paying down your credit line, you are well on your way to having good credit. Of course, you do have to pay the balance on your credit accounts on time every time.
The fastest way to lose your creditworthiness:
Not paying your bills when they are due. Paying off your debt as quickly as possible will help you to build that good credit history.
Because of the stability and reliability of a military service paycheck, many creditors are willing to extend credit to a service member who may have poor or no credit at all.
Even with a secure paycheck, it is possible to develop a bad enough credit history that creditors will refuse even your solid earnings potential.
However, if you are responsible with your credit and pay your debts on time, you will find military service can be a big benefit to your credit score and your creditworthiness.
Photo source: thebestseattleweddingdj.com.