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6 foolish reasons people don’t check their credit

By
Lynnette Khalfani-Cox
  • Credit
  • 5 minute read

Didn’t check your credit report in 2014? You’re not alone.

According to the National Foundation for Credit Counseling, 65 percent of Americans say they haven’t checked their credit report in the past 12 months. Sixty percent said they hadn’t checked their credit scoreduring the same period.

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That’s a problem.

“There could be erroneous, outdated or fraudulent information on your report that’s hurting your credit score and costing you money,” says Anthony Canale, a certified financial planner and chairman of the Financial Planning Association, New York chapter.

Adds Gail Cunningham, National Foundation for Credit Counseling spokeswoman: “Consumers should think of their credit report as their financial fingerprint. It is one of the basic building blocks to financial success, and worthy of their attention.”

Here are six reasons consumers say they don’t check their credit and why each is foolish:

1. I’m scared of what I’ll find

It’s time to get your head out of the sand, says Anthony Davenport, credit management and protection specialist and founder of Regal Financial. “A lot of people have been through tough times and they just don’t want to deal with it,” he says. “It’s probably not as bad as you think. You can’t fix everything but you can make it a whole lot better.”

2. I don’t want to hurt my credit score

“Checking your report has zero impact on your FICO score,” says Davenport. “Even having it pulled when you are seeking a loan will usually have a negligible impact.”

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3. I don’t know where to get my truly free credit report

Finding a truly really free credit report can seem confusing, admits Canale. Make sure you go to AnnualCreditReport.com, the only site explicitly directed by Federal law to provide your free credit reports. “You should look at your report from each of the three reporting agencies — Equifax, TransUnion and Experian — every year,” he says. “The best way is to request a different report every four months so you can monitor your credit more than once a year for free.”

4. I checked my credit last year

Credit reports are not static. They are constantly being updated. Last year’s information is just, well, so last year.

Besides, warns Davenport, “2014 was a banner year for identity theft: Sony, Chase, Target, Home Depot all got hit.” He adds: “Twenty percent don’t know they’ve been a victim of identity theft for at least four years. If you don’t find out for four years, good luck fixing it! It’s like telling a police officer ‘Help, I was robbed four years ago.’ What do you think he’s going to be able to do for you?”

5. I don’t need to check my credit because I’m not seeking a loan or credit card

Your credit report is important for other reasons like getting a new job, lowering car insurance rates or even just being approved for an apartment rental.

Up to 70 percent of credit reports contain an error, according to Davenport. “You don’t want to find out you have an error when you need credit. It takes months even for a professional to fix. It can take you years to correct a mistake. You want to give yourself enough time to take care of it before you need credit,” he adds.

6. I won’t understand what my credit report says

“Many people mistakenly believe that they won’t be able to make sense of what’s on their credit report, so why bother,” says Canale. “It’s not as difficult as you may think. If you spend some time looking at it, you will be able to see if there’s bad stuff there — which is what you’re looking for anyway,” he adds.

Clearly, there are a lot of bad reasons not to check your credit report. Are there any good ones?

“I can’t think of a single reason why you shouldn’t check it out and see what’s being said about you,” says Davenport. “You should see what the banks are looking at and make sure it’s accurate,” he adds.

Cunningham agrees, noting: “Since it can be obtained free of charge, consumers have little excuse for delaying taking action.”

Bottom line: Checking your credit report should be at the top of your list of financial priorities. It’s free. It’s easy. And it could save you a lot of money in interest and reveal if you’ve been a victim of identity theft before it’s too late.