Renew Your Mind
The world teaches us to spend more than we earn, take on mortgages that we can’t quickly pay-off, and accept student loans as life-long obligation. But Romans 12:2 delivers a different message: “Don’t live any longer the way this world lives. Let your way of thinking be completely changed. Then you will be able to test what God wants for you. And you will agree that what He wants is right. His plan is good, and pleasing, and perfect” (New International Reader’s Version).

Debt is not God’s will for our lives. Countless books have highlighted people who’ve paid off thousands, tens of thousands, and even hundreds of thousands of dollars. They cut off their cable, took on two (or three) part-time jobs, got a roommate, opted for a less expensive car, downgraded their homes, and did whatever was legally (and morally) possible to pay off their debt. So it’s doable! However, the first step is changing the way we view debt. If you need some motivation, read Psalm 37:21: “Evil people borrow and never repay their debts” (The Voice). That verse is unlikely to be voted “Favorite Scripture,” but it’s probably the most helpful when renewing our financial perspective.

Learn the Score
FICO (named for its inventor, Fair Isaac Corporation) considers five factors when calculating your score: payment history, debt, length of credit history, types of credit used, and new credit. Your age, income, and net worth don’t play a factor. Scores range from 300 to 850. Anything above a 750 is considered “excellent.” Anything below 550 is considered “poor.”

When determining your FICO score, payment history is the most important factor. It includes the timeliness of your payments, and the length of any delinquencies. Also included are negative public records (such as bankruptcies, judgments, or liens). This information comprises 35 percent of your score. Your debt (type of debt, amount of debt, and percentage of available credit being used) makes up 30 percent of your score. Credit history (the length of time your accounts have been open, and when the accounts were last used) comprises 15 percent of your score. The types of credit used make up 10 percent. Generally, having a variety of accounts (such as credit cards, mortgage payments, and retail accounts) is more beneficial. New credit applications (the amount of recent credit inquiries, and the number of new opened accounts) comprise the final 10 percent of your score. Creditors are leery of applicants who open several new accounts in a short period of time. This activity may indicate financial desperation.

Take a Look
According to a study conducted by the National Association of State Public Interest Research Groups, 79 percent of all credit reports contain some type of error – and 25 percent contain errors that could lead to denied credit. But there’s good news: 80 percent of consumers who filed disputes experienced a modification to their credit reports.

Each year, you’re entitled to one free copy of your credit report from each of the three bureaus (Equifax, Experian, and TransUnion). You can visit to get your free copy. It’s not unusual for an error to show up on one bureau’s report, but not on the other’s. So carefully check each credit report, and file a dispute when needed.

Don’t Close Them
After you pay off an old credit card, don’t close your account. You can stop using the card – and cut it up – but keep the account open. Approximately 15 percent of your FICO score is determined by how long you’ve been managing credit. As a result, if you close old or unused accounts, your credit score will lower. Thus, keep those older credit lines open.

Address those Fines
Almost anything you don’t pay in a timely fashion can negatively affect your credit score. And anything includes library fines! That overdue copy of Cinderella might be attached to an outstanding bill. And that outstanding bill (from five years ago) probably got sent to a collection agency. Library fines, parking tickets, medical bills, and all kinds of ignored debts can hurt your credit score.

Lift Your Spirit
Not only is reducing your debt the fastest way to boost your FICO score, it’s a great way to boost your spirit. You’ll feel a sense of accomplishment, and significantly diminish your level of stress. People with higher scores tend to use approximately 7 to 10 percent of their available credit. They practice financial restraint, don’t max out their credit cards, and free their spirits. c