Best Free Credit Reporting Services | Why You Should Know Your Credit Score

Use Your Credit Score to Your Advantage – Discover the Best Free Credit Reporting Services and How They’ll Help You Travel Cheap

Before you embark on your journey to travel independence, there’s one crucial number you need to discover for yourself that will determine how much flexibility you have in both the short and long term for earning rewards.

That number is your FICO credit score. As we mentioned in Part I, the travel credit card will become your most valuable tool for free and or discounted travel. You won’t be able to apply for a lucrative travel credit card if your credit score is sub-par. But it’s not just your score that matters, other factors included on your annual credit report can also affect what sort of credit card products you may be eligible for. Let’s solve the issue of not knowing right now.

The First Step Towards Cheap Travel

Determining Your Credit Score

I can’t stress enough the importance of knowing your FICO credit score. This is the number that pretty much any lender is going to look at first. It can be your best friend or your worst enemy.

Whether you’re applying for a credit card, a mortgage or a car loan, the financial institution you’re hoping to enter into a partnership with is going to run a credit check on you. When they do this, it will ding your credit score back anywhere from 3-10 points, typically. Long story short, you should know your score before you apply for a credit card. If it’s too low and you apply for an excellent-credit-required product, you’re going to get dinged AND turned down.

Services Should You Use to Check Your Credit Score

There are two free, reliable services out there that I use personally to monitor my credit report and score. They are CreditSesame and CreditKarma. You should enroll in both. Why you ask? Well, there are multiple credit bureaus that maintain your credit report and profile. CreditSesame works with Experian. CreditKarma works with the TransUnion credit bureau. Not uncommonly, these bureaus can sometimes show different scores and details pertaining to your personal report. In order to get the most accurate picture of your credit standing, you should be looking at reports from at least two bureaus, ideally three.

If you want to get a credit report from a third credit bureau for free, enroll in Quizzle as well. They work directly with Equifax, the last major credit bureau.

Okay, so you’ve seen your 2 or 3 credit reports. What now?

You’re going to be feeling one of three emotions at this point. Happiness, sadness, or confusion.

If you’re happy, you now know that you have a high credit score and are likely eligible for a quality travel reward card product. If you’re sad, your score is sub-par. If you’re confused, the number any of above services just spat out means nothing to you. Below, take a look at the general myFICO scores that help determine whether you have poor, fair, or excellent credit.

Best Credit Reporting Services | Why You Should Know Your Credit Score

This is a recent copy of my actual credit report as given to me by my Discover More Credit card. As you can see, having a score over 800 means more lenders are willing to take a risk on me. I currently have a car loan while balancing 5 credit cards, and I’m still able to maintain an 800+ score. You can do it too if you manage your credit responsibly.

*NOTE* It’s not just your credit score that matters. Before a lender makes a decision on your enrollment, they’re going to look at other factors on your credit report that reflect how trustworthy you are. The below pie chart illustrates all of the factors that contribute to your overall FICO credit score.

Travel Hacking | Why You Should Know Your Credit Score | Credit Reporting Services

Graphic courtesy Creditcards.com.

If you’ve never had a line of credit before, or you only recently acquired one, that means you’re a credit newbie. There’s nothing wrong with that. Everyone has to start somewhere. If this is you, you should hold off from applying for a top-tier credit card until you have a little bit longer credit longevity. In the mean time, you should apply for a more mid-level card product in an effort to bolster your score and credit reputation. Credit bureaus like to bring on new customers who have shown they can manage multiple lines of credit and keep them all in good standing. That means it’s okay to have several card products open — as long as you pay off your balance off every month. If you can’t pay off your balance, you shouldn’t be opening a new credit card account right now.

Continue to Monitor Your Credit Score, Be Responsible With Your Credit

Your credit score is going to change month-to-month. It’s a fact of modern life. Missing a payment, applying for a loan or a new credit card are just a few things that will cause your score to fluctuate. That being said, check it every month. We recommended three services above that allow you to do this for free with no catch. So you have no excuses not to be on top of your financial lifeline.

Lastly, remember to be responsible with your credit. I’m going to say it again — it’s your financial lifeline. If you want to continue to get approved for great travel credit cards and rack up epic signup bonuses, slacking on managing your credit is going to kick you in the ass. A poor credit profile also leads to terrible mortgage rates. Don’t dig a ditch for yourself and start being responsible from the start. Just take a look at my credit profile above. Being credit-responsible works.

Hopefully this guide gives you a good grasp on the importance of knowing your credit score, what factors play a part in determining it and what the best credit reporting services are.

In Part III, we’ll discuss applying for the right travel credit card, getting the most value out of a travel credit card, how to determine what credit card is right for you, and more.

Quick Links:

Continue On to Part III | Applying for Travel Credit Cards + Recommended Travel Credit Cards

Go Back to Part II – Travel Hacking | Applying for Rewards (Loyalty) Programs

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1 Comment

  • Credit monitoring has definitely been a life changer for me. I’ve recently had to utilize a lot of loans and even carry some credit card balance due to some health issues and having a good credit score has drastically lowered my interest rates, which will make it easier to recover.

    I also in the past was able to get down to 1.8% on a car loan and open up a bunch of great travel credit cards. If only we had the education when we were kids.

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