You’ve gotten on top of your budget. You’re carefully managing your expenses. And, as a part of your newfound focus on finance, you’ve been looking for ways to get that elusive perfect credit score.
After all, that’s just what financially-savvy people do, right?
And while credit monitoring companies do exist alongside the traditional requesting-your-credit-report manually approach to credit management, there’s another option that can offer the advantages of both strategies in a single, often free, package:
Credit monitoring apps.
On that note, here are four incredibly good reasons to consider adding a credit monitoring app to your arsenal of personal finance tools.
1. It’ll Help You Spot Problems With Your Credit Report
For many, the words “There’s a problem with your credit report.” conjure up images of identity mixups and unexplained credit card charges.
But in reality, not every error on a credit report is an identity theft issue.
Inaccuracies can include:
- Accounts you’ve paid up being recorded as unpaid
- Negative account information that’s been on your credit report for too long
- Incorrect balance amounts
According to the Consumer Finance Protection Bureau, up to one in five Americans may have mistakes on their credit reports. A credit monitoring app that you can pull up on your phone and check from time to time makes it easy for you to keep track of your credit report entries.
2. You Can Get Credit Score-Boosting Advice
When it comes to credit scores and credit management in general, a lot of advice suffers from a “Now what?” problem.
“I got a credit card because I want to improve my credit score. Now what?”
“I have a credit score of 710 but I want to hit 800 by this time next year. Now what?”
In short, people often walk away with a sense of what to do but they don’t always know how to translate that knowledge into practical results.
To make matters worse, it’s often the little details that can weigh your credit score down the most.
- A credit balance that’s just high enough to skew your credit utilization ratio
- Having a department store credit card, a personal credit card, and a secured credit card but no installment loans or mortgages in your credit mix
- Applying for too much credit at once
Researching credit score improvement tips may require you to sit down, search for information, and read a ton of content before you feel ready to implement what you’ve just learned. Credit monitoring services are often able to give you the tips and advice you need with the press of a button.
3. An App May Help You Spot the Signs of Identity Theft Early
The Ascent reported that in 2019, there were 650,572 cases of identity theft in the United States.
Part of the reason why identity theft is so dangerous is that it can sometimes take a while to catch. After all, the credit card or the loan might get taken out, but that statement more than likely won’t be sent to your mailbox.
As such, the next time you view your credit report could very well be the first evidence you see of an unauthorized account that’s been opened under your name.
Because it’s easy to use and available on your phone or computer, a credit monitoring app can go a long way towards helping you spot signs of possible identity theft before it has a chance to spiral out of control.
4. It Can Help You Address Outstanding Payments Immediately
Your credit score will calculate details like how long you’ve had your credit accounts or the type of credit you have. However, the factor that impacts your credit score the most is your payment history.
If you’ve been paying your bills and staying on top of your expenses, it’s easy to overlook payments owed from way back when.
People get busy and it’s easy to misread a $20 bill as a $10 bill or to move and miss a statement. But even if the nonpayment wasn’t intentional, those small unpaid amounts can have a serious impact on your credit score as well.
What’s nice about credit monitoring and tracking apps are that many will have a simple and intuitive layout. These design features in turn make checking your payment history as easy as looking at the time.
Managing your credit isn’t something that you can do once and then forget about. It’s important to know what’s happening so that you can improve your credit and pursue your financial goals.
To that end, a free or affordably-priced credit monitoring app can make it easy for you to keep your finger on the pulse of what’s happening with your credit. Maybe there really is an app for everything.