Why the Upper Class Still Needs Good Credit
Money can buy a lot of things, but a good credit score isn't one of them. Some of the upper class may focus less on credit because they are set financially; however, credit doesn't reflect wealth, it reflects reliability, which makes credit an important tool for those in the upper class as well as everyone else. After all, having good credit can present opportunities that even money can't offer. For example, having good credit can provide better job opportunities, easy housing and rental approval, better insurance rates, etc. Here are a few reasons why even wealthy people should continue to keep track of their credit:
Good credit often comes with low interest rates. Paying higher interest rates may not sound like a big deal, especially to those who have a surplus of wealth; however, consistently paying high interest rates can become a financial burden. Avoiding high interest rates can be relatively easy with a high credit score.
One important aspect of being rich is staying rich. While many wealthy people can afford to pay cash for a car or other high-priced items, this can deplete liquid assets. Even the wealthy may need to apply for loans to pay for expenses like college tuition or home renovations. By maintaining a high credit score, those in the upper class can secure loans that will allow them to make more reasonable payments over time. In the long run, loans can keep the rich from overspending and help them stay on top of their financial standing.
Once again, maintaining wealth is an important part of a wealthy lifestyle. Therefore, taking advantage of credit card rewards can definitely help. Rewards are designed to celebrate credit achievements as well as save money. Using rewards tied to airlines, hotels, or cash back can be a great way to make sure that you're not over paying for certain services or goods. Since people in the upper class tend to spend more on luxuries like vacations, rewards can play a major part in saving them some money which allows them to maintain with their lifestyle.
Potential for Fraudulent Activity
Identity theft and security breaches aren't just targeting the average person. It makes sense that those with more money are going to be higher on the list of identity theft targets. One of the best ways to know if your accounts are exposed to any potentially fraudulent activity is to regularly check your credit report as well as your account statuses. Maintaining a good credit score can be a good motivation to regularly check your credit report and will help you take action if your accounts ever become compromised.
Above all, maintaining a good credit score can help you develop good, long-lasting financial habits which, in turn, will benefit you no matter how much money you may have in your bank account. Knowing and understanding the importance of credit can save you money, prevent you from making bad financial decisions, and open doors to future opportunities.
Written by: By: Alayna Pehrson – Digital Marketing Strategist at Best Company