Retirement is your reward for committing to years of hard work. But while you may be planning to see the world, finally write that book, or just spend lots of time with your grandkids, you may not be giving much thought to your post-retirement credit score. You may believe that, upon exiting the workforce, you can stop worrying about those pesky credit reports, but this couldn’t be any further from the truth.
Still not convinced? Here’s a look at five reasons why keeping an eye on your credit score should still be a priority throughout your retirement.
1. Credit card rewards programs
Many savvy retirees choose to utilize credit cards for everyday expenses, as a good card can enable you to accumulate rewards. As long as card payments are made in full each month, you can avoid interest while still reaping the benefits of buying with credit. If you keep your FICO score high, you’ll enjoy access to the best credit card rewards programs – including platinum-level travel cards. This can make it a lot easier for you to manage airfare, hotel costs, and other travel expenses throughout your retirement.
2. Great insurance rates
Auto and homeowners insurance agencies look to credit scores when quoting monthly premiums. When your credit score is higher, you will appear to be more responsible, resulting in lower overall insurance payments. Even if you have been insured with the same company for years, you should never stop shopping around for a better policy. Keeping your credit score high can help you to find all of the best deals, and will provide you with negotiating power with insurance agents. This is especially important in retirement, as any monthly savings can provide you with more capital for both regular expenses and making the most of each day.
3. Refinancing your mortgage
Although entering into retirement without any debt is a noble goal, the reality of the matter is that nearly 40 percent of senior homeowners, ages 60 to 64, carry a mortgage. This statistic, provided by the research of Strategic Business Insights, makes it clear that retirees should make plans for managing mortgage payments after work. Those with a high credit score will enjoy the luxury of being able to refinance their mortgages, enabling them to save significantly on monthly payments… Ultimately, this could mean the difference between being locked down by your home, or living the dream.
4. Keeping an eye out for identity theft
Retirees who believe their credit scores to be irrelevant may not take the time to review your credit reports each year. This is bad news, as senior adults are often targeted for identity theft, and unless you regularly monitor your reports, you may not realize that you have been victimized. To minimize your risk, be sure to always keep an eye out for suspicious activities or mistakes.
5. Second acts
For many individuals, the meaning of retirement has changed dramatically. Instead of viewing retirement as the closing chapter of life, a growing number of retirees are viewing this as a “second act” – a time wherein they have the ability to pursue their dream careers, and finally do the work that they love. This may mean becoming the author of a children’s book, building custom furniture, or selling crafts and artwork at trade shows. While many second act goals may not require a lot of capital investment, some do. Having a good credit score could make it easier for you to obtain any necessary loans.
Your credit will always matter. By keeping tabs on your score, you’ll enjoy a happier, more peaceful retirement.