Source: Jodi Kaus, 785-532-2889, jkaus@k-state.edu
News release prepared by: Kayela Richard, 785-532-2535, media@k-state.edu

Wednesday, Feb. 16, 2011

EXTRA CREDIT IN FUTURE STARTS WITH GOOD CREDIT SCORE NOW, FINANCIAL EXPERT SAYS

MANHATTAN -- Getting a good grade on the next exam isn't the only score college students need to be thinking about, according to a Kansas State University financial expert.

Jodi Kaus, program director of K-State's Powercat Financial Counseling, says students should also be concerned about their credit score because it could potentially be used by lenders, landlords, utility companies and employers.

"We liken it to your financial GPA for life," Kaus said. "The Fair Isaac Corporation credit score ranges from 300 to 850."

The higher your score, the better your creditworthiness.

The majority of your credit score is based on payment history, Kaus said.

"Not paying on time can have the biggest impact on your credit score and can cost extra fees and charges, so students really need to focus on that," she said.

Another common mistake students make is using too much of their credit limit. Kaus says they should generally use no more than 30 percent.

"If you have a credit card with a $1,000 limit you shouldn't charge more than $300 before paying it off," she said. "Small usage of credit, paid off in full each month in a timely fashion, will help build the best credit score."

Having a poor credit score can be costly and lead to problems in the future.

"Students might be subject to higher interest rates and extra fees with a low credit score," Kaus said. "It could also impact them negatively in getting additional credit down the road when they'll really need it to buy a car or if they're not able to get the job or apartment they need."

If a student is having trouble making payments on time, Kaus suggests setting up automatic payment from your bank account to avoid late fees and higher interest.

"You still need to review your monthly statements to ensure accuracy, but if you're on vacation you'll know this bill will still get paid on time," she said.

Kaus said it's important to monitor your credit regularly.

"Everyone is entitled to one free credit report annually from each of the three credit bureaus: Equifax, Experian and TransUnion," she said. "We suggest doing so once every four months, using a different bureau each time to get a free report."

To request a free credit report from these government-approved sites, go to http://www.annualcreditreport.com.

Powercat Financial Counseling provides free information and services to K-State students and has walk-in hours on Wednesdays from 9-11 a.m. The service is located in the office of student activities and services on the ground floor of the K-State Student Union. More information is available at http://www.k-state.edu/pfc.