101 in 1001 #35, #36: Credit Reports, Credit Cards, and a Budget!

One of my personal goals for the next year (not a resolution, just a general goal!) is to manage my money more actively and effectively. I’ll be the first to confess, I’ve never really worried about things like my credit score or spending, primarily because I’m fortunate enough to have been debt-free and financially independent since I started working in 2011. I have healthy savings, and have always been able to spend comfortably on entertainment (um, hi, brunch). 

As I’m watching my friends make major life changes…buying real estate, for example…I’m starting to think more about things, though, and decided to make 2016 a year of active financial management for myself. I've been doing a lot of research, making and sticking to budgets, and cutting out some of the extraneous frills in favor of more careful spending and saving, and I'm really proud of myself! 

I started that off by applying for my credit score and a credit card. Believe it or not, I’ve actually never had a credit card before…I’m averse to the thought of carrying debt, and knew I could build good credit by regularly paying things like my car lease. I was completely out of my depth, therefore, when I started getting ten credit card offers a day at my apartment. Um, thanks but no thanks. Instead, I met with a Wells Fargo banker, where I currently bank, who decided that with my current financial position and infant credit, I’d be suited to their 0%-APR CashBack Rewards card. I don’t plan to use the card for anything but to pay utilities and my car payment on a monthly basis, and just transferred the auto-pays on each of those accounts over.

Along with opening a credit card, I used CreditKarma to check my credit score for the first time ever. (Again, judge away, I’ve genuinely never thought about things like this before, and I know that’s incredibly lame on my part.) CreditKarma performs “soft” inquiries to get the score, which don’t negatively affect credit, and I was pleased both to find it incredibly user-friendly and to find out that my score is, as predicted, really good. The only thing hurting it, in fact, is that (as I mentioned) my “credit age” is low. Basically, I haven’t had the luxury of time to build excellent credit for years, so the longer I maintain regular payments and manage my credit well, the more that aspect of my score will improve.

Having totally nerded out and with my fresh new plastic hanging out in my wallet, I decided to take things a step further and finally start leveraging Mint.com to create a 2016 budget! I started a Mint account a few years ago to track spending, but haven’t really used the budget tool super effectively or consistently. To maximize my use of Mint, I created different, customized budget categories for everything from rent/utilities to shopping, subscriptions, and even brunch...of course! 

My favorite feature is to be able to see where exactly my money goes every month. The image above isn't my personal budget breakdown, but shows what I see every month when I go check out how my spending is allocated. For example, looking back over 2015, the "coffee" wedge was absurdly too large...which spurred my resolution to give up "designer" coffee in 2016! Seeing things like where I've splurged too much and saved particularly effectively make me feel much more in control of the big picture when it comes to my money. 

A lot of this seems incredibly intuitive, but as I said above, I really haven't ever paid too much attention to the nitty-gritty of how I spend and budget. These small steps have been a great way to start 2016 off in a fiscally responsible way...which makes me feel even better about some of the fun spending I have coming up on travel, weddings, and entertainment! 

Interested in what else I've been up to? Head over to my 101 in 1001