Is your financial lifestyle good, average, or in need of a little help to get ahead? The amount of money you have in the bank is not always a good indicator. Some people have hefty savings accounts but poor credit, which impacts their ability to borrow for a home or to cover a major emergency. On the other side of the coin, there are many who have no saved cash have excellent scores. Whichever area needs improvement, there’s a strategy that can get the job done, provided you work patiently and diligently toward the goal.

There are plenty of benefits to having excellent credit and a healthy cash reserve. For one thing, you can assist others by cosigning for a college loan, lending a small amount of money for an emergency, donating to a charity, purchasing a first home, or taking a well-deserved vacation. Before working to improve your financial lifestyle, it’s smart to know the basic facts about borrowing, creditworthiness, and related issues. Consider the following facts.

Scores Change Constantly

It’s common to hear people speak about credit bureau scores as if the numbers are carved in stone or change infrequently. Anyone who has a monitoring subscription with a consumer service knows that scores frequently rise and fall for many reasons. For those with poor ratings, that’s good news because it means they can take decisive action to ramp up their numbers with all three of the major bureaus, Equifax, Experian, and TransUnion. What should consumers do if they need better ratings? While it can take as long as six months to change a weak score to a stronger one, the most effective tactics for getting results include:

Correcting errors on official reports

Paying bills on time

Getting card balances as low as possible

Paying off past-due accounts

Keeping card usage at 30% or less

You Can Cosign for Someone’s College Loan

Some otherwise well-informed adults are surprised to learn that it’s possible to cosign for another person’s college loan. In fact, the practice is not only possible but quite common. The situation with large numbers of education loan applicants is this: they have almost no financial history, little in savings, and slim chances of being approved for a school loan.

When they’re able to find a cosigner, the probability of approval rises considerably, as does the chance that the applicant will snag a decent interest rate on the agreement. It only makes sense that student loans with cosigner status get through the lender’s process much quicker and generally end up with more favorable terms in every respect. If you want to improve someone’s long-term career prospects in a straightforward way, consider serving as a cosigner. While your financial lifestyle won’t be affected, theirs will enjoy a significant boost.

Refinancing Can Be a Wise Tactic

Refinancing an auto or home loan can be a money saving decision because the new agreement often includes more favorable interest rates, advantageous terms, and more time to repay the entire debt. While home refinancing deals can be very complex and involve various moving parts, car loan refi’s are more straightforward. Many automobile owners get both a lower interest rate and one or more additional years to pay off the obligation. Those conditions can be game-changers for those who have been laid off or are trying to pay down high-interest credit card balances.

Secured Charge Cards Help Establish Credit

If you need to do a little reconstructive surgery on your credit score, consider using a secured card. There are many on the market, each with its own fees, conditions, penalties, interest rates, and minimum opening balances. Try to find one that has a security deposit you can live with. Then, aim for a reasonable interest rate, low or no annual fee, and backing from a well-known bank or financial institution. Don’t forget to double-check that the one you select reports to all three major credit bureaus.

Open a Savings Account

Savings accounts serve several purposes, but one is often overlooked. If you intend to purchase a home or other large asset soon, just having an open savings account can increase your chances of gaining approval for a loan. Lenders look favorably on borrowers who regularly save money, whether via a payroll plan at their places of employment or on their own.

Homeownership is a Worthwhile Goal

Young professionals who live in apartments tend to ignore the long-term advantages of home ownership. While not everyone wants or needs a house, qualifying for a mortgage and owning a home is one of the most powerful ways to build a solid credit score and establish financial security into retirement. Whether you plan to marry and start a family or not, consider buying a condo or house that suits your need for space and can serve as an investment property.