Your Facebook Profile Might Be Affecting Your Credit Score

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Many people are guilty of over-sharing on Facebook — whether they realize it or not — and the potential consequences of what people post on social media are getting even worse.

There once was a time when the only thing at stake was your reputation, but those days are long gone. Most people are well aware of the potential risks of social media these days, and it’s no secret that a Facebook post can get you fired from a job or prevent you from getting a job in the future.

But your Facebook profile now poses a new threat — to your credit score.

According to a report by the Financial Times, some of the top credit rating companies are now using people’s social media accounts to assess their ability to repay debt. So if you want to be able to qualify for a loan and borrow money, this is just another reason to avoid saying certain things on Facebook.

“If you look at how many times a person says ‘wasted’ in their profile, it has some value in predicting whether they’re going to repay their debt,” Will Lansing, chief executive at credit rating company FICO, told the FT. “It’s not much, but it’s more than zero.”

Lansing said FICO is working with credit card companies to use several different methods for deciding what size loans people can handle, and using non-traditional sources like social media allows them to collect information on people who don’t have an in-depth credit history. According to the FT, both FICO and TransUnion have had to find alternative ways to assess people who don’t have a traditional credit profile — including people who haven’t borrowed enough to give creditors an idea of what kind of risk they pose.

According to Lansing, FICO is “increasingly looking at data on a spectrum” to determine an individual’s credit-worthiness — with credit card repayment history being the most important factor on one end and information volunteered via social media on the other end.

And social media isn’t the only alternative source factoring in to people’s credit-worthiness. Credit rating companies are also using individuals’ payment history on phone bills, utility bills and even movie rentals. One good sign to creditors is if someone hasn’t moved a lot — which could suggest they’ve had problems paying rent.

“We can now score the previously un-scoreable,” said Jim Wehmann, executive vice-president for scores at FICO.

And while this may be a great way for more people to get access to loans, it’s also a wake-up call for those “previously un-scoreable” people to clean up their digital footprint — and fast.

Social Media Week

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How To Maximize Your Loyalty Rewards On Branded Credit Cards

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Carrying a credit card branded to a specific retailer can provide some significant benefits. Branded credit cards are different from store cards, in that you can use them anywhere to earn rewards from a specific retailer. If you prefer to shop in one specific place, funneling other spending toward perks that you can use there might seem like a no-brainer.

The problem, though, is that many people open these credit card accounts and then fail to maximize the benefits. Sure, they might get some coupons here and there, but more often than not what happens is consumers end up spending more money on their branded credit cards than they would have otherwise, making the rewards less than rewarding. But with a few smart moves and a better understanding of how rewards program work, it is possible to get even more from branded credit cards.

Pay Close Attention To Fees

Paying fees can negate any savings you’d enjoy from loyalty rewards, if you don’t pay attention to the fine print and shop smart. Before you sign up for a card, review the annual fee disclosure and the spending required to earn rewards. Consider the annual fee in relation to the required spending to earn a reward, and where your “break even” point will be. For example, if you have to spend $ 5,000 to earn a $ 10 rewards certificate, and the annual fee is $ 50, is that really the best deal for you? In some cases, the card’s additional benefits do negate the fees, but not always, so do your homework.

In addition, pay close attention to any fees charged to actually redeem your rewards. This is especially prevalent with travel rewards credit cards, where you may have to pay a fuel surcharge or booking fee for a flight, or resort fees on a “free” hotel night. On some flights, the fuel surcharges can add up to almost as much as the cost of just purchasing the ticket outright, so understand the conditions before you work toward a specific goal.

Align Your Cards With Your Interests

It might seem to go without saying, but it’s important to consider the potential rewards offered by a card when opening an account, and whether they are something you will actually use. It doesn’t make sense, for example, to carry an airline rewards card for a carrier that doesn’t operate out of your home airport, or a hotel chain where you rarely spend the night. Retailer branded credit cards can offer some useful rewards, but only if you shop there on a regular basis. If the specific rewards of that card don’t appeal to you, consider a cash back card that give you money you can use toward things you actually want.

Take Advantage Of Rewards-Earning Opportunities

Often, card issuers give cardholders the chance to earn extra points or cash back during special promotions. A travel card might provide a bonus for stays or flights during a certain period, for example, or a retailer-branded card will offer extra points when you purchase specific items. Watch for these promotions and when appropriate, take advantage of them. In some cases, they can add up to thousands of extra points or a big boost to your cash back rewards.

Add An Authorized User

Adding an authorized user, such as a spouse or child, can increase the rewards earning opportunities on your card. Combining all of your family’s spending on to one account can help you keep track of expenditures while also giving you more rewards. Just remember that you’re still responsible for paying the charges an authorized user racks up, so have a payment plan in place.

Consider Additional Benefits

Earning points or cash back are often only the tip of the iceberg when it comes to rewards credit cards. Pay close attention to the list of “perks” offered to cardholders, such as free shipping, discounts on certain services (such as personalization), early access to special events and sales, exclusive experiences, and more. Often, these rewards can be as meaningful as coupons or cash back while also justifying an annual fee.

Watch Expiration Dates

Finally, to get the most from your rewards credit cards, be sure that the rewards that you earn don’t expire before you can use them. Often, rewards certificates awarded with points have expiration dates, meaning that if you don’t use it, you lose it. Don’t miss out on the benefits you are entitled to have.

Getting the most from your rewards credit card doesn’t mean shopping until you drop and racking up huge bills. With some smart spending and a bit of strategy, you can earn some valuable bonuses, without maxing out your card.

How To Maximize Loyalty Rewards On Branded Credit Cards

Maximize Rewards Credit Cards

Maximize Rewards Credit Cards

IMAGE: [SHUTTERSTOCK]

Bit Rebels

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