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Do credit scores matter after retirement?


Do credit scores matter after retirement? I guess that depends on whether you need to borrow money or not. I’m not planning to borrow any money for a while so for the short term we don’t have to worry about credit scores much. We have a recent model car that is paid for. We are not planning to move anytime soon and we are set with our mortgages. We also have over $50,000 in our emergency fund in case we run into any financial trouble over the next few years.

Good credit scores are essential for the long term

For the long term, we still need to maintain our good credit scores. If we relocate in the future, we’ll need a good credit rating to we get a good rate on the mortgage. Also, if the interest rate falls any more, we might have to think about refinancing again. Mortgages are a bit more difficult though because we need both good credit rating and good income. Our income fell quite a bit when I left my job so it might be harder to get a mortgage now.

Also, I plan to never work for another corporation again. Once baby RB40 goes off to school, then I’ll have more time to work on other self employment options. If I decide to invest in a restaurant or some other business, I might need a small business loan from a bank to get started. A good credit score would be very helpful then. Another alternative is peer to peer lending. Prosper will give you a better rate if your credit scores are good.

free credit check score

Monitor your credit scores

All in all, it’s a good idea to have good credit scores even when you don’t really need them. We also need to monitor our credit scores regularly to make sure there aren’t any problems. By checking the credit scores once or twice a year, I can make sure nobody opens a credit card in my name. It is also good to go over the credit report in detail and make sure there are no mistakes. One late utility payment can screw up your credit score. By paying attention to my credit scores, I will have more options in the future.

It’s been a while since I checked my credit so I signed up with GoFreeCredit to see how I’m doing. I’m also curious if quitting my full time job will change my credit scores. At this point, it looks like my credit scores weren’t affected by my transition to being a stay at home dad.

Here are my scores
free credit scores

Positive factors

You have never been late with your payments, and no collection accounts or negative public records are listed in your credit report.

Negative factors

You opened 5 account(s) in the past 24 months.

  1. refinance primary residence to lower rate
  2. refinance rental home to lower rate
  3. take out mortgage for the 4 plex
  4. American Express – I got this so I can use a credit card at Costco
  5. Chase Southwest card – I opened a new account to get airline miles…

Overall, things are looking pretty well. I’ll avoid opening any more credit accounts for 12 months or so. This will let some of these prior accounts roll off the 24 months record.

GoFreeCredit will show you all 3 credit reports from Equifax, Experian, and TransUnion as soon as you sign up. They will also monitor your credit and alert you if there are any problems. You can try this service for 30 days at no charge. It will cost 16.95/month after that. If you just want to check your current standing, then you can call and cancel in a few days.

*Update* I called and was able to cancel the service in less than 5 minutes with no hassle. The rep asked if I’d like to switch to a lower price plan at $11.95, but I said no thanks and he canceled my account.

Have you checked your credit scores lately? How do they compare to my scores?

Apply to check your credit scores today


Disclosure: I do get a referral fee if you sign up to check your credit through the link on this page.


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Joe started Retire by 40 in 2010 to figure out how to retire early. He spent 16 years working in computer design and enjoyed the technical work immensely. However, he hated the corporate BS. He left his engineering career behind to become a stay-at-home dad/blogger at 38. At Retire by 40, Joe focuses on financial independence, early retirement, investing, saving, and passive income.

For 2018, Joe plans to diversify his passive income by investing in US heartland real estate through RealtyShares. He has 3 rental units in Portland and he believes the local market is getting overpriced.

Joe highly recommends Personal Capital for DIY investors. He logs on to Personal Capital almost daily to check his cash flow and net worth. They have many useful tools that will help every investor analyze their portfolio and plan for retirement.
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{ 22 comments… add one }
  • William @ Drop Dead Money August 10, 2012, 2:44 am

    Being retired, I honestly didn’t care that much about our credit scores. But you’re right, you never know and when you need it is the wrong time to start working on it. Good heads-up, thanks!

    • retirebyforty August 10, 2012, 6:40 am

      I didn’t care that much either, but now the interest rate is so low. I’ll have to call the bank and see if they’ll give me a no fee refi.

  • Another Reader August 10, 2012, 5:13 am

    Sponsored blog posts undermine your credibility. Shilling for overpriced and hard to cancel credit monitoring services is very disappointing behavior and I am less inclined to read your blog in the future. Monetizing the blog is good, just not in this way.

    • retirebyforty August 10, 2012, 6:39 am

      It’s hard to monetize a blog. I’m going to the Financial blogger conference next month and hopefully I can pick up some tips. I’ll call and cancel today. If it’s that hard to cancel, I’ll remove the post. Sounds good?
      This is not a sponsored post ie. I didn’t get paid to write this. I’ll add a disclosure at the end.

  • Another Reader August 10, 2012, 8:39 am

    Monetizing should not spill over into the content. Why don’t you look at Mr. Money Mustache’s blog as a model of how to monetize? He was making a really good income off the Chase credit card referrals without the ads intruding into the content until they nailed him for cussing. You don’t swear and you write a lot of interesting, timely, and heartfelt content that should appeal to these companies.

  • RichUncle EL August 10, 2012, 9:02 am

    Hey Joe yeah credit scores migh matter to you if you plan to apply for a business loan, but otherwise it wouldn’t because most retirees would not need to borrow any more. Also I would not recommend that you refinance unless your able to really knock down the rate in addition to a few years off the mortgage as well. The reason is that the principle amount you are paying now is greater than you paid last month, and if you refinance, it starts all over again and you have a greater amount going to interest again. But I’m sure you knew that already. Talk to you soon.

    • retirebyforty August 10, 2012, 2:00 pm

      Mrs. RB40 doesn’t want to refinance either, but the rate is quite low. I’ll have to crank the numbers and see if it make sense.
      I don’t know if I’ll apply for a business loan, but more options is better, right?

  • [email protected]&More August 10, 2012, 12:13 pm

    Joe, I think you did a good review for this product and laid out the terms of their offer and disclaimed you would get affiliate income. I wouldn’t let one reader scare you off for writing reviews for products you use as you don’t do it often. If you did it once a week it might get old but this is the first I have seen!

    • retirebyforty August 10, 2012, 2:00 pm

      I added the disclaimer a bit later. I should have put that in when the post went live. Oh well, live and learn. I’ll keep the advertising down to once every few weeks. 🙂

  • [email protected] August 10, 2012, 1:02 pm

    If I was going to give a negative comment, I would leave my name. It’s easy to be negative when you’re anonymous. You and I have almost the same score. We just got ours due to taking out a mortgage for our rental property. My husband has an 800! We kind of have a contest between our scores, so I’m wondering how his is better. I guess with my business credit card I get dinged. It gets paid off every month but sometimes has a high balance during the middle of the credit cycle. If they check it then, it might look like I use too much credit. It would be nice to never use credit, but probably not possible or even smart.

    • retirebyforty August 10, 2012, 2:02 pm

      Wow, 800. That’s nice. I don’t think I ever reached 800 so that’s a goal I can shoot for.
      I think Mrs. RB40 has about the same scores as I do.

  • Mike August 10, 2012, 6:39 pm

    Yea the review and the negative comment are things to be aware of. Typically I tend to make my readers aware of the affiliate links I am using but as mentioned by previous commenters, just keep these kinds of posts to a minimum (maybe once every few months, rather than weeks?). Having these kinds of posts occasionally can be good, just don’t over do the posts. Nice review by the way.

    • retirebyforty August 11, 2012, 6:37 am

      OK, I’ll make sure to put a disclosure at the end of any posts with affiliate links. I need to ramp up my monetization effort so I’ll keep exploring different ways to do that. Thanks for your input.

  • Cherleen @ My Personal Finance Journey August 10, 2012, 10:38 pm

    Whether or not you have plans of getting a loan after retirement, I believe it is always best to keep a good credit score. I totally agree with you. We will never know what will happen and when we are going to need help, loan for this matter.

    • retirebyforty August 11, 2012, 6:38 am

      That’s right. All landlords check your credit scores these days and if you have a bad score, it will be more difficult to find a place to live.

  • Broke Professionals August 11, 2012, 5:05 am

    I’m relieved to see that you think it is important to have a credit score for the long term – I’ve been reading some PF blogs lately that argue you don’t need one at all, and shouldn’t have one if you really live debt free. I think it’s a risky proposition to let it go down because of disuse!

    • retirebyforty August 11, 2012, 6:40 am

      It’s great to be debt free, but we also need to be able to function in society. It will be more difficult to rent an apartment with bad or no credit scores. That alone is enough reason to keep a good credit.

  • Barbara Friedberg August 11, 2012, 2:16 pm

    My opinion… They only matter if you are renting an apartment, looking for a job, or borrowing money. Other than that, who cares?

  • JW @ AllThingsFinance August 11, 2012, 9:54 pm

    I don’t think “good” credit scores matter as much, but you must maintain some kind of credit rating. I get many retirees who try to open brokerage accounts to either sell or buy stock. Many of them have to jump through hoops because their credit has not been accessed in years. Thanks to the Patriot Act, we must verify identity the person by running a soft credit hit and no credit = no identity.

    • retirebyforty August 12, 2012, 7:26 am

      I didn’t know you need a credit score to open a brokerage account. That’s interesting. Thanks for the info.

  • First gen American August 29, 2012, 3:08 am

    I thought bad credit scores could also affect your insurance premiums. Not sure where I heard that or if it’s accurate. Might be a good follow up,post topic for you.

    • retirebyforty August 29, 2012, 4:52 pm

      I’ll work on that. Thanks!

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