Tips like these helped us pay off $127K in debt. You can read our story in Slaying the Debt Dragon: How One Family Conquered Their Money Monster and Found an Inspired Happily Ever After.
Welcome to 31 Debt Free Missions! This year on Queen of Free, during each day in January, I will provide 31 concrete debt free missions or challenges for you to take on to #SlayDebt and take charge of your finances this year. Each mission will take you less than an hour (some will only require 15 minutes). Whereas, 31 Ways to Kick Debt in the Teeth (which I’m reworking this year and reposting in January, too) focused on some of the philosophical changes you need to make in order to be successful with money, 31 Debt Free Missions are action steps to put into place after you have your thinking straight. Even better, during the month of January, I’m revisiting each of these challenges in order to sharpen my money saving and debt slaying skills.
Today the King of Free is bringing you the task at hand (and it takes less than 10 minutes!).
Are you ready? Your mission is as follows:
Day #2: Run Your Credit Report
It’s a six minute mission. 6:00.86 to be exact. I timed myself when I ran mine so that I could tell you how long this was going to take. There’s gotta be at least a one second margin of error given that I was operating a stop watch and pulling the report. So we’ll call it six minutes and I’ll try to set a PR for credit report pulling next year. January 1st is traditionally the day that I pull my report. It’s the beginning of the year, usually I have the day off from work and, as it turns out, every year begins with January 1st – true story. No kidding that’s why I pick it. Another day may work best for you. Choose one. You’re entitled to one free report every twelve months so it’s important to pick a day that you will remember.
WHY YOU NEED TO DO THIS
Lenders report your payment history and credit account statuses (credit cards, mortgages, car loans, etc.) to three major credit reporting agencies: Equifax, Experian, and TransUnion. You want to make sure that the information is correct. It also acts as a checklist for debt repayment. While you may generally know what your debts are, there may be something old that you forgot about. You may owe an old judgment to a landlord from your wild college years, an old unpaid utility bill, or something else that escaped your mind. If you’ve ever been married or in business with someone before and aren’t now, you want to make sure that there aren’t any open joint accounts. Shut those down if there are. You also want to make sure that no one else is using your identity. This is serious business. If an account is listed on your report and it is not yours, follow the dispute instructions on the report. Don’t ehhhver dispute something on the report that you know to be true. That’s fraud. It’s not cool. And I’m not sure we’d still be friends if you did that.
DON’T PAY FOR THE REPORT OR ANYTHING
It’s a trap. Buying things is for suckers. The report is free from annualcreditreport.com. FREE. If there is ever a prompt asking for payment, you are not in the right spot. Don’t buy credit monitoring. Identity theft insurance is inexpensive and does way more than monitoring, but I wouldn’t buy it from a random hyperlink. Research that later. Stay on mission. Don’t get your credit score. You don’t need to know your credit score if you’re not going to borrow money. This is a debt free mission not a get debt mission.
HOW TO OBTAIN YOUR CREDIT REPORT
1. Set aside some time where you’re not going to be interrupted.
2. Load your printer with paper and check your ink (I’m a paper kind of guy).
3. Go to annualcreditreport.com
4. Pick one of the three reporting bureaus. I picked Experian solely because it was listed first.
5. Fill in basic information about yourself. It knows everything about you anyway.
6. Be prepared to answer questions about yourself like old phone numbers and addresses. Like any test you should study. It’s about you, but it’s harder than you think.
7. Receive the report online and review (at this point you’re at the 6 minute mark) or
a. Print the report out so you can touch the paper and review.
b. In any event, save the report number (it’s conspicuous) for future access.
c. Panic and call an 800 number because you had an open credit card account even though you’ve told half the free world that you’ve canceled all of your credit cards, contemplate the scandal and question your own integrity until you actually read the report correctly and realize that the right hand column shows how long the account will be reported not how long the account is open.
d. All is right in the world.
* Maybe part just applies to me? This did add some time to the mission. Plus we were $127K in debt a little while back, so there were plenty of entries to wade through.
8. Have your spouse run his/her report and repeat. If you’ve been paying attention to my personal pronoun usage, there’s a lot of I and not much we. That’s because credit reports are for individuals, not couples. The Queen has to run her own. We can binder clip the documents together later so they don’t get lonely.
FOOTNOTE: Technically, you can get one report from each of the three reporting agencies free every twelve months (3/year). There’s some benefit to doing this because you can compare the reports to make sure each is reporting the same information. My suggestion is that if you pull one and there’s a mistake or problem, immediately pull the other two. If you pull one and it looks fine, wait until the following year to do it again. If it’s just gonna kill you to not know what’s in the other two reports, wait four months in between each report. That way you will have a consistent scheduled check-in on your financial affairs.
Back to the Queen
There you have it . . . challenge number 2. This mission isn’t difficult at all, but makes a big difference! You have to know how much you owe and discover if there are any errors out there too! Oh and I ran my own credit report using the King’s tips last night and it didn’t take much time. But can I be honest? It made me a NERVOUS WRECK and we have been debt free since 2012. So if it makes you nervous, that’s OK. I kind of felt like I was being called into the principal’s office or something? Be bold. You can do this.
Did you see the previous Debt Free Mission? Knock them all out this month!
My book is now available: Slaying the Debt Dragon: How One Family Conquered Their Money Monster and Found an Inspired Happily Ever After. You can also check out Inspiration to Pay Off Debt: 30 Days of Encouragement from the Queen of Free
This post contains an affiliate link. That means when you get a great deal or maybe even something for free, you also help our family pay off our mortgage early. And for that, we royally thank you!
Sometimes it is good to get that FICO score. My current home & car insurance company as well as previous companies use my credit score to determine rates. Also, I discovered I had a lower score because I did not have a mortgage – duh, my house was fully paid for over 10 years ago, of course I don’t have a mortgage!
Way to not have a mortgage! Well done. You’re absolutely right, your credit score can (and usually does) affect your insurance rates. I’m fearful of the day when I absolutely lose my junk on my insurance agent because our rates spike due to a low FICO score. We’ve resigned to live the way we’re going to live knowing there will be some nonsensical fallout. Looking at our scores won’t change our behavior. My concern for folks trying to get out of debt is that the FICO score will send a mixed message and derail progress. Getting out of debt is hard enough without that kind of distraction. I don’t want debt slaying sojourners wandering in the wilderness because they are longing for the bitter herbs of the FICO score when real freedom is just in front of them. Also, I was the best man in my insurance agent’s wedding. He knows the day is coming. I’ve asked for forgiveness in advance.
Yes, I can certainly see why this would be distracting and a person does not want to get distracted while paying off debt. Also, the score wasn’t low just lower.
Good to know since we’re headed that way. Out of curiosity, were you able to talk any sense into the insurance company with your rate increase?
Changed companies! Saved a bunch of money yearly. It does pay to shop around. We had been with that company for over 20 years, too. Just think how much money we wasted.
Our guy is an independent agent (I should write about that). He had tried to get us to switch for a few years, but I was loyal to the only agent I ever had – also 20 years. My original agent retired. We switched, upped our coverage, and saved close to 40%.
Since we can get all 3 reports for free once each year, I get one of the three every four months. This way I can get an update and check for any mistakes more often than once a year.
Great idea.