If your credit score is good, you’ll know it. Pre-approved credit offers will be stuffed in your mailbox every day, and banks will likely bend over backwards to offer you the lowest rates on all types of loans. However, if your credit score is low or non-existent, you’ll be trapped in a world where loans are hard to come by and the rates and fees on loans you are able to get will be very costly. This can potentially add up to hundreds of thousands of dollars over a lifetime, all because of a three digit score that is calculated by a computer program. And to make matters worse, many employers and insurance companies are also using credit scores as a factor in making employment decisions and pricing insurance rates. So there is more risk at stake by having a bad credit score than just higher interest on loans. A low credit score can affect your life in many ways you might have never even imagined!

Luckily, as the significance of credit scoring has increased, so has the transparency of how credit scoring works. Credit scores are determined by a mathematical formula run by a computer program. This program considers several factors regarding payment history, account balances, type of credit used and new credit recently acquired. Most people are able to effectively manage their credit once they learn how this scoring model works.

Technology and the internet have also made it much easier to keep track of your credit score and credit history. Many companies provide services that allow for regular monthly monitoring of your credit report and score, and also offer additional services, such as identity theft protection. Identity theft and fraud are the fastest growing crimes in the worldFind Article, and many people don’t learn they are a victim until it’s too late. Unfortunately this means that regular monitoring of your credit score and report are no longer a luxury-it is now a NECESSITY. Protecting against identity theft in the digital world can go a long way towards preserving a good credit score. And many people who rebuild their credit history are devastated to learn an identity thief has compromised their personal information. Identity thieves don’t target people with bad credit; they target those with GOOD CREDIT since those are the people that can easily obtain credit and loans.

Managing your credit score and guarding your identity have never been more important. The time to take control is now.

By: John Rasor