The High Cost of Crappy Credit (Bestie Ep) #1083

Jan 2, 2026

Discover why bad credit can be like a power outage, causing far-reaching consequences. The hosts share personal anecdotes on the hidden costs of poor credit and how it impacts loans, insurance, and even job prospects. Learn the importance of healthy credit, why perfection isn't necessary, and practical steps to improve your score. They also discuss the generational differences in credit scores and provide tips on how to check your credit and repair it effectively. Tune in to avoid costly financial mistakes!

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ADVICE

Check Reports And Dispute Errors Yourself

Check your credit score and reports regularly using free tools like Credit Karma and annualcreditreport.com.
Use the score details to see what's hurting you and dispute errors yourself for free.

ADVICE

Avoid Carrying Balances With Low Credit

Expect higher interest across mortgages, auto loans, and credit cards if your score is low.
Avoid carrying revolving balances to prevent severe APR penalties on cards and loans.

INSIGHT

Credit Influences Renters Too

Renters feel credit effects too: landlords use scores to decide applicants or require larger deposits.
Low credit ties up cash in deposits and limits housing options.

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Think back to the last time you lost power at your place. I’m sure it was an inconvenience- it was likely annoying to find yourself walking into a room and reflexively reaching for the light switch, even though the power was out. But the real problem with an outage are the downstream effects it has: food in the fridge spoils, traffic is a nightmare if the stoplights are out, folks even die due to extreme heat or cold. We’re less worried about a power outage and more worried about the mayhem that ensues. And in a similar way we’re less worried about silly credit scores and more worried about the negative impact that a crappy score can have on much of your personal finances. Listen as we discuss our stance on taking out loans, the high cost of neglecting your credit, and steps that you can immediately take in order to mitigate the knock-on effects of crappy credit.

Want more How To Money in your life? Here are some additional ways to get ahead with your personal finances:

Credit card perks: Check out our favorite credit cards that we use to maximize rewards and optimize our spending.
Other money nerds: Find a thriving community of fellow money nerds by joining the HTM Facebook group!
Newsletter: Sign up for the weekly HTM newsletter. It’s fun, free, & practical.
Money Gears: knowing what to do with your money is crucial to your personal finance journey.
MG7: and maybe you’re well on your way to financial independence but you’re looking for some financial reassurance, that’s when heading over to HowToMoney.com/Advisor and getting matched with a highly vetted financial advisor makes sense.

During this episode we enjoyed a Grapefruit Radler by Halfway Crooks Beer! And please help us to spread the word by letting friends and family know about How to Money! Hit the share button, subscribe if you’re not already a regular listener, and give us a quick review in Apple Podcasts or wherever you get your podcasts. Help us to change the conversation around personal finance and get more people doing smart things with their money!

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