Shape up your finances by checking your credit score for free

JUST as staying fit means dragging yourself out of bed on a cold morning for a run, keeping your finances in good shape also requires effort.

GOOD health and good finances are more alike than you think.

Keeping in shape on both fronts takes some preparation, motivation and discipline.

Just as staying fit often means dragging yourself out of bed on a cold morning to go for a run, keeping your finances in good order requires you to resist spending money you don’t have, keep on top of bills and debts and actively save some of your income.

Personal trainer James Lugsdin knows the feeling well.

While he may be in top physical and financial shape now, not so long ago that he was paying back a debt accrued after years of travelling overseas.

“Now I pay debts as they come in and I never pay interest,” Lugsdin says.

So when a friend challenged him to get his free credit score he was up for it and was pleasantly surprised that he achieved a very good score of 780.

“It’s always great to get a good score,” he says.

Research from getcreditscore.com.au shows that four in five Aussies believe knowing their credit score would be useful to improve their overall financial position or life goals.

And many Australians say they are doing the right things to build up their credit score such as always making loan and credit card repayments on time (58 per cent) and showing a history of saving (41 per cent).

getcreditscore.com is giving away free credit scores so you can give your finances a check-up.

Diana Saad Senior Financial Planner at BT advice says she usually recommends clients check their credit rating.

“If they are going for a loan and they think their record could be a bit ‘iffy’ because they might have defaulted on a loan or bill it’s a good idea to check in advance,’ Saad says.

Otherwise if you apply for a loan and are rejected it will make your credit score look even worse.

Defaults or unpaid bills stay on your record for five years, so even if you have whipped your finances into shape in recent years, it might be worth checking your score so there are no nasty surprises should you apply for a loan.

Saad says set yourself a healthy routine of always paying down debts on time and don’t apply for new credit cards frequently. Also when you move house make sure all the bills have been paid at that address so you don’t forget.

“If you’re on the cusp of a good and bad (credit score), if you check your rating it’s a good way to put yourself on notice. It’s a way to motivate yourself.”

Lugsdin says while he is not ready to settle down and get a mortgage just yet getting his credit score showed him he is “a healthy specimen and that is good to know”.