Take a deep breath. That hiccup on your credit report may not be your fault.

There are quite a few causes of inaccuracies that could be hurting your credit history. Before you start blaming yourself for missing a payment, overlooking a hospital bill or carrying a credit card balance, think real hard. A Consumer Protection Financial Bureau (CFPB) report from December 2012 listed a bunch of causes of credit report inaccuracies.

Look for documentation that you made a payment because any one of the following causes could be damaging your credit history.

Data errors

Humans operate the furnishers — such as a credit card company or an auto finance company — that provide information to the nationwide consumer reporting agencies (NCRAs). For the purposes of the CFPB’s report, the NCRAs were Transunion, Experian and Equifax.

Furnishers’ information pertains to their transactions with consumers. For example, a credit card company tells Equifax your Social Security number (SSN) to get this line of credit in your report.

Well, mistakes happen. It can be as simple as misspelling your name or messing up your SSN. The problem? An “orphan” credit file originates that is separate from your actual credit file. Worse yet, a data error can lead to mixing two consumers’ credit files.

Matching inaccuracies

NCRAs may not match your credit file if you start a new line of credit. This may be due to a name change or a credit lender (e.g. a credit card company or bank) not providing identifying information, such as your date of birth or SSN.

Common examples include consumers who change their name after a marriage or divorce. Family members with similar identifying information like a name (Jr., Sr.) or who live at the same address often have files overlap when they should not.

Process errors

Say you disputed an error on your report with the credit bureau that had the error on file. If that bureau fails to correct the error, the NCRAs would have no record of the correction. Your credit report takes the hit. A host of errors may arise as a result, such as:

• An account with you listed as the owner when you’re only an authorized user
• A payment being incorrectly attributed
• Closed accounts listed as open
• Credit limits being incorrectly reported
• A payment not being listed
• A failure to update credit records, such as a resolved tax lien being listed as open

Identity thieves

A clever criminal can start a new account — credit, utility or health care — in your name. Then the thief doesn’t pay for it. Accounts like this go delinquent, forcing collection agencies to take over. Meanwhile, your credit score dives.

Identity thieves can also take over your account. They hide by changing the billing address. Tons of these criminals buy things online. Worse yet, identity thieves can use your SSN, last name or birthday to create fake identities. As a four-time victim of identity theft, I can say it’s painful. Thankfully, I’ve been able to catch it before it affects my credit history, but you must be proactive in checking your credit.

Time lag

Even though you may do the right thing and pay an electric that’s past due, it may not immediately get reported to the credit bureaus. Simply put, it takes time for changes to reflect on your credit score. But if your good behavior isn’t showing up, thus hurting your credit history, it’s time to file a dispute.

Now that you’re enlightened on what causes credit report inaccuracies, it’s time to get to work on disputing problems. If your credit score is already in the high 700s, a 10- or 15-point increase may not be as worthwhile. But for consumers with a credit score of 620 or lower, every point matters.

For some consumers, a 20-point jump could be the difference between being declined a new line of credit and getting approved. Future homeowners want every point possible to ensure they get the best interest rate on their mortgage.

Have you found inaccuracies on your credit report? If so, how did the dispute process go? How many points did you recover on your credit score?

Christian Losciale is a writer and social media specialist for Smart Military Money. Connect with him on Google+.

Image Credit: Shutterstock.com

Take a second to answer!

Your browser doesn’t support iFrames Vote for this poll here.

Prepaid Cards Are Helping Consumers Take Control of Their Finances and Credit Rating

Since consumers must fund prepaid cards, people who use prepaid credit cards are not burdened with having to make monthly payments like consumers with credit cards.  This is because all purchases are immediately deducted from available balances.  As such, consumers do not have to worry about derogatory credit reports to the credit bureaus.

Prepaid Credit Cards Can be Used to Pay Bills and Purchase Items Online and in Stores

Prepaid cards are also advantageous for consumers with bad credit because consumers can use them anywhere credit cards are accepted.  For consumers without a credit card or a bank issued debit card, a prepaid credit card gives them the freedom to make purchases online and in stores.

In addition to the freedom to make purchases, there are no limitations as to how much a consumer can spend each day with prepaid cards.  Once a prepaid card has been funded, the consumer can make small and big-ticket purchases.  This is just one of many advantages of having a prepaid card, but that is not all.  Prepaid credit cards can also be used to pay for bills and expenses.  With a prepaid card, consumers have the flexibility they need to pay their bills when they want.  For consumers who do not like to carry cash, prepaid cards offer the perfect solution.

Prepaid Credit Cards Are Perfect For People With Little to No Credit

In addition to helping people pay for bills and make purchases, prepaid credit cards are also an excellent choice for people with no credit.  Students who do not work or do not have credit history often have trouble qualifying for a traditional credit card.  With a prepaid credit card, students have the ability to make purchases when they want even though they do not have the credit.  In addition, with prepaid credit cards both students and parents can easily add money to their cards anytime they want.

Consumers With Prepaid Cards Can Earn Money and Referral Fees

Depending on the prepaid credit card, consumers are often able to earn rewards each time they use their card.  In addition, some prepaid credit cards also offer referral fees.  For consumers in need of additional money, a prepaid credit card may be a great way for consumers to earn extra money.

Whether a consumer has bad credit or little to no credit, prepaid cards give consumers the flexibility and power they need to take control of their lives in more than one way than one.  From no caps on spending limits to being able to pay for high-priced items, prepaid credit cards are advantageous to people with bad credit in many ways. Regardless of whether consumers ultimately choose the Green Dot Card or a different card, they should always compare cards before making a final decision.

This piece was contributed by Raymond Pinkerton, a freelancer based in the greater metropolitan area of St. Louis, Missouri; he regularly writes on finance, politics and other prominent issues in society.

Image Credit: Shutterstock.com

The First Light Bulb Goes Off

This continued throughout my college years until shortly afterward when I read the book Your Money or Your Life by Joe Dominguez and Monique Tilford along with some books about financial planning and responsibility by Suze Orman. The concept that really changed my life, which all of the authors hit on, was that I was trading my life energy for all the debt I was taking on. I also learned to re-calculate my wage in a more realistic fashion. Even if I earned $10 an hour, I hadn’t before thought about the fact that my taxes, uniforms, travel expenses, “decompression time,” drinks after work, and lunches out all lessened the amount of my real hourly wage. After I subtracted all that, I found myself lucky to even come home with $5 an hour.

The Second Light Bulb Goes Off

I also learned that when I bought things on credit, I paid a lot more for them in the long run, sometimes over five times as much as the item originally cost. If I could give you another piece of my best advice it would be this: before you do any of the other things mentioned in this article like consolidating your debts or seeing a financial planner, visit an online calculator to determine the real cost of the items that you buy on credit. That $4 latte may cost you $10 or $20 in the long run, and more expensive items may cost you hundreds or even thousands in interest.

Key Takeaways

* Know what you’re really earning per hour

* Realize you’re trading the hours of your life for your goods

* You’re trading future hours of your life for your current debt

* Calculate the real cost of the items you buy on credit

* Using your real hourly wage, consider how many hours of your life you’re trading for the things you buy on credit

Cut Expenses

Now that you know what you’re really paying for, some of the “must haves” in your life, reassess whether they’re really “must haves” or “I like to haves.” You don’t have to go crazy; life should be fun, after all, so don’t feel like you need to start living like a pauper. However, try to use the information in the previous two paragraphs to separate the worthwhile expenses from the worthless. Is having cable TV really worth the number of hours of your life energy it’s costing you to have it? If your “real” hourly wage is $10 per hour after your work-related expenses, and you have a cable package that costs you $150 per month, you’re trading 15 hours of your life for that cable TV package every month. That’s 180 hours of your life every year!

Sell Unnecessary Items

Go through your home and find all the items you don’t use regularly. Assess whether you can bring yourself to part with some of these items. Do you have fun toys like jetskis or a guitar collection that you rarely use? Do you have TVs for more than one room in the house? Sell what you can and use the money you receive for these items to help pay off some of your debts.

Get Help: See a Financial Planner

Because of the taboos we have around money in our culture, many people feel like they are afraid to ask for help when it comes to managing their money. Asking for help requires you to admit that things aren’t working anymore, and they require you to own up to your mistakes and face them. However, once you’ve taken this difficult step, you’re on the road to repair and recovery regarding your finances. A financial planner can help you see how to live within your means and help you learn how to plan for the future.

Take out a Consolidation Loan

Get a consolidation loan, refinance your home, or put up other collateral for a loan in the amount of your debts. Try to find the lowest fixed rate that you can. Don’t go for a variable rate – you might get a low initial offer but end up paying a sky-high rate later on. Consolidation loans work well when you’ve acquired the skill to live within your means and haven’t taken on any new debt but are having trouble keeping up with high monthly payments on many past debts.

Declare Bankruptcy

This may sound like a drastic measure, and, believe me, it is. Don’t undertake bankruptcy lightly or without a lot of careful forethought. However, if you have what feels like an insurmountable amount of credit card debt, bankruptcy still exists as an option that provides true relief for people who have a lot of debts from credit cards. It can give you a fresh start on a blank slate and relieve the heavy burden of debt from your shoulders. Stay aware, though, that your credit will need repairing and rebuilding after bankruptcy. The bankruptcy will stay on your record for at least seven years, and you will likely encounter difficulty in getting credit extended to you during this period.

 Conclusion

The key to taking control of your finances and stopping bad habits is to realize how much your debts really cost you in terms of your life. Most people haven’t received any training or education to truly understand the real-life costs of living on credit cards. Once you know what you’re really trading for the things you buy on credit, start making life changes that help you take control, such as changing your spending habits and doing what you can to reverse the flow of money in your life from negative to positive.

Steve Gott is always looking at ways to improve his finances. He frequently shares his insights on personal finance blogs. Click here for more information on short term funding alternatives.

 Image Credit: Shutterstock.com

#1: School Clothing

Your school children will need something nice to wear, and perhaps money remains tight around the plantation; you’d find exponential benefits in taking unused reward dollars and applying them towards rewards malls or stores where points can be traded for clothing items.  Even if you only obtain three garments, it’s still better than forking over cash.

#2: One Month Of Groceries

Give yourself, and your family, a much needed break spending tons of money at supermarkets simply by cashing your unused account credits in for money which can be used to offset one month of food.  Depending on rewards amounts left to redeem, you could even splurge on T-bone steaks or filet mignon.

#3: College Textbooks

Bearing the expense of four-year tuition will already make your finances suffer if inadequately prepared with savings for your child’s future education; if your rewards never expire, build them up high enough to cash out towards academia literature.  The books are pricey; every little bit of relief in buying them helps.

#4: College Tuition

Go ahead, say it now: it’s entirely unfeasible to offset the college tuition of today’s expensive semesters.  Consider this: if your points never expired with two people spending, paying, spending and even signing up for Add It Up features as featured with Bank of America, you literally could take credit cards, save the points and cash in several years down the road towards college tuition.  Give it a try.

#5: Uncovered Medical Expenses

Ingenuity sprinkled with Humana coverage means you’ll have the opportunity to cash out your rewards points and offset your potential out-of-pocket medical expenses which amass your yearly insurance benefit, your copays or even the deductible.  This would require direct deposit of rewards into your checking account in order to effectively pay your expenses, yet it’s definitely a worthy trade.

#6: Christmas Presents

Why force yourself into another debt treadmill by spending cash or more credit on Christmas presents when thousands of cash back rewards are sitting idly inside your credit accounts?  Take your points, transfer to your checking and take the wife or husband gallivanting across town picking up socks, lumps of coal or whatever egregious presents you find the mother-in-law deserves.

#7: Man-Cave Construction

Wife emphatically told you not to build man-caves on the family’s dime.  You have thousands of points sitting around the credit card accounts doing nothing more than yawning; time to build man cave on Chase’s dime while leaving her enough points to buy some Vera Wang purses or Paula Deen cookware. Lumber, roofing materials and required flooring to make the man hut perfect shouldn’t run that high if you know where to buy.  Sorry, guys – living rooms with flower pots and pretty window valances don’t count as ‘man cave material’ and will, in fact, subtract 10 man points for every dollar spent in that room.

#8: Building Online Business

Does your family own some wonderful shop in town and wishes to finally go global with products or services offered, yet lack proper monies to begin the marketing, site building and branding aspects which epitomize online business nomenclature. Gather your cash back points, slap them into your checking account, and begin shopping for inexpensive services to get that ‘Ma and Pa’ storefront online.

#9: Breast Cancer Research

You could definitely show your big heart for humanity simply by donating your uncared for reward balances towards breast cancer research, the most needed medical research and cure I can think of.  Once breast cancer cells are isolated, more types of cancer could be cured.  At the end of the day, your cash back rewards save ‘second base’ and make the most profound impact on women’s and men’s lives.

#10: Donate To Charity

Charities always need government financing which, of course, is starting to spread thin.  If there isn’t some fashion which exists to take cumulative points and trade for cash or donate directly to local charities, their needs to be.  Imagine if 2000 county residents put forth several million points into one coffer to help battered women, children get clothing or feed thousands of homeless folks – wouldn’t than mean something?  Donating always builds monstrous hearts amongst life’s constituents.

In Closing

Cash back rewards can accumulate into the accounts of busy families who simply follow routines of working, paying bills, running kids around and heading back home for more.  Instead of letting these rewards stay dormant forever or wasting them on account credits just to let interest eat them up, spending these much deserved points or dollars on useful items as listed above makes better financial sense.

About The Author: Dave, freelance writer and business marketing specialist, has accumulated points and wasted them in the past, thereby causing him to rethink his strategies.  When he’s not complaining about Chicago Cubs baseball or political agenda, he writes for Technorati, Social Media Today and also operates his cash loans initiative aimed at assisting people with short term financial needs.

Know your credit history

Your ability to receive a credit card with decent interest rates depends upon your credit score and credit history. Unfortunately, many young entrepreneurs don’t know where their credit currently stands. Before you venture out and pursue your entrepreneurial dreams, find out what your chances are of getting a credit card with good rates. The best way to do this is to pull a free credit report from at least three different credit-reporting agencies. In case you didn’t know, a credit report will show your account history and all the factors that have injured your credit.

Know your limitations

Wouldn’t it be wonderful if everyone paid off their credit card balance at the end of every month? Alas, we don’t live in such a world. Before you charge anything to a credit card, take some time to figure out if you’ll be able to pay it off in a reasonable amount of time. If you don’t think you can deal with high-interest rates – ranging from 13 and 20 percent –you should analyze whether or not you’re financially ready to pursue your entrepreneurial dreams.  If you do take out a credit card and discover you’re having trouble making reasonable payments, however, contact your creditor and explain your difficulties. Oftentimes, they’ll be able to help you setup a decent payment plan and even lower your interest rates.

Know how to pay on time

Paying your bill on time is of the utmost importance in maintaining a sound credit score, so always make sure to pay all your bills on time. If you’re afraid you might forget to make payments, go ahead and set up automatic payments. Why? Well, paying on time boosts your credit score and even helps you negotiate lower interest rates. Even if you can’t pay off as much as you’d like each month, always make reasonable, consistent payments. You might think a day or two won’t matter, but in the long run, it could affect your ability to operate a successful business.

If you want to break off and pursue your entrepreneurial dreams, keep these three credit card facts in mind.

As a regular contributor to several finance websites, such as www.CreditScore.net, Stella Walker uses her knowledge of economics, consumer trends and budgeting to help readers better understand their own personal finance issues. Feel free to leave your questions and comments for her below!

This article originally published on Under30CEO

How many credit cards do you own?

None – 16%

1 – 2 – 42%

2 – 3 – 21%

3 – 5 – 5%

5+ – 16%

Why do you think the results came out this way? The only surprise for us (maybe even a concern) was the vote for 5+ credit cards. We believe that credit cards serve a great purpose for many people. There are many advantages to having and using a credit card the right way. However, once you start trying to manage to many cards you can quickly find yourself missing payments and making errors. Credit cards are a great tool but you have to understand how to use them to your advantage.

The process of credit card consolidation

Have you accumulated too much debt? Do you find it difficult to manage the bill payments? If yes, then you may choose credit card consolidation and pay off all your outstanding debts. When you enroll with this program, the debt specialist assesses your financial condition by considering your income and expenses. He will negotiate with the creditors and request them to reduce the interest rate on the debt amount that you owe. You will have to make a single monthly payment on all your outstanding debts. The debt payments will become affordable for you. It can be said that credit consolidation is a suitable way to eliminate the credit card debts that you’ve accumulated so that you can enjoy being debt free.

The advantages of credit card consolidation

Credit consolidation helps you reduce the credit card bills that you may find difficult to manage on your own. Have a look at the advantages of credit card consolidation.

One monthly payment – This is one of the main advantages of this program. You may combine all your bills into one and make one monthly payment. You will have to deal with one creditor and send your payment to him every month. This makes it easier for you to keep a track of what you owe.

Lower interest rate – Debt consolidation enables you to secure lower interest rate on your outstanding bills. Most of the people do not want to pay off the credit card dues since the companies impose high interest rate on them. With the facility of reduced interest rate, you will be able to manage the debt payments within your affordability.

Improve credit score – When you do not pay off the outstanding debts on time or miss out the payments, it hurts your credit score. You will have to take the needed steps to boost your credit score. Once you start repaying your debts with the help of this program, your credit score may improve with time.

Negotiate with the creditors – You may not be able to negotiate with the creditors for reducing the interest rate on your outstanding debts. As such, you may enroll with a debt consolidation program where by the debt expert will do the work for you. With his proper negotiation skills, he will be able to convince the creditors to lessen the interest rate on your outstanding debts.

Lead a debt free life – If you have accumulated huge credit card debts, you may choose debt consolidation and get rid of debt problems. It is important that you pay off all your outstanding debts at the earliest time possible so that you may be able to lead a debt free life.

You should search for an authentic debt consolidation company if you want to repay your outstanding debts with their help. For this, you may ask your friends who have faced such problems earlier so that you can eliminate your debt problems soon. Once you get rid of debt worries, you will be able to live a relaxed life.

Author’s Bio: This article is written by John, who is a Financial writer. He has written several articles for different sites and financial blogs.

So, we wanted to see how many credit cards most young professionals have today. Take a second to answer below!

One of the most challenging aspects of becoming a true adult in the “real world” can be the new financial responsibilities you suddenly have to take on. With your first “real” job comes the struggle of “first job finance” issues. Consider these newbie real-world financial issues to better master the world of financial responsibility and freedom.

Building Credit

Building strong credit is very important as a new college graduate. With constant talk of record breaking student debt and huge national debt, taking out a credit card doesn’t necessarily sound like the best of ideas for many 20-somethings. Already likely in the financial hole (so to say) with student debt, taking out credit can feel like you’ll just be digging that hole deeper. However, that’s where smart credit use comes into play. Building strong credit is an important aspect of adulthood. It is through strong and reliable credit habits that you can make educated large purchases.

Explore your credit options. Find a card that offers some sort of rewards program that will benefit you and your lifestyle. There are many cards out there that offer cash rewards that can help pay a portion of your balance each month. The absolute number one tip to building credit as a young newly employed adult is to use your credit like debit. Pay off your balance in full each month. I realize this is a very ideal situation, but I’m a firm believer in not spending more than you have until you really have your financial footing.

Saving Wisely

Saving your money wisely is all about knowing what you have to save. For 20-somethings just entering the world of “real” employment, saving can be a tricky thing. Those of us who are lucky enough to find solid employment are faced for the first time with actually having some money of our own to spend. This slight financial freedom can lead to some very unwise financial habits. Take a look at how much you actually spend and what you spend it on. Understanding your money habits is the best way to then revise them and turn them into smarter choices. Something that many newbie college grads fail to do is create a habit of saving each paycheck. Pay yourself first—this is the best financial step you can take. Set up your finances to automatically put a portion of your paycheck into your savings account. By paying yourself first and making something that is done automatically, we can contribute to our savings painlessly.

Smart Investing

Investing is the next most important aspect of making smart financial choices as a young adult. This is the number one area that newbie grads fail to succeed in most often when it comes to finances. As newly graduated and newly employed individuals, the last thing on our mind is typically retirement. But, of course, retirement is one area of our finances we should consider early for the best results. Of course, everything depends on your own personal situation, but, if you are able to contribute to an employer supported retirement plan, do so. Do your research on 401ks and retirement issues in general. The more you know about the process, the better prepared you will be to deal with it. If you have the means to do so, consider opening a Roth Individual Retirement Account (IRA). These accounts allow you to contribute a chunk of money to an account where it can grow tax free, with better interest rates, and you do not have access to it until you are of retirement age. I realize that putting away the money you just gained access to until you are in your 50s is not a very desirable thing—but, preparing for the future is the first sign of true adulthood.

Lauren Bailey is a freelance blogger who loves writing about education, new technology, lifestyle and health. As an education writer, she researches and contributes to a guide to online colleges and welcomes comments and questions via email at blauren 99 @gmail.com.