Number one financial tip - give yourself good credit | Toronto mortgage broker Ingrid McGaughey

My #1 financial tip? Give yourself (good) credit!

Number one financial tip - give yourself good credit | Toronto mortgage broker Ingrid McGaughey

Why do I blog about finance?

My blogging on this site sometimes feels a bit uncomfortable. I worry that I might sound “preach-y”, or worse, bossy (something I’m kinda sensitive about, being the oldest child of four). And in reflecting on what my # 1 financial tip would be, who do I really think I am, trying to come up with the most important thing that people should focus on financially?

The right place at the right (financial) time

have been very lucky to have learned a lot about finance just by being in the right place at the right time. My family immigrated to Canada from Slovakia, and apart from being very careful spenders (“do you really need two watches, Ingrid?” my father would ask my teenage Swatch-desiring self), my parents really weren’t able to pass on much about financial planning.

But because of a wonderful branch manager who hired me at a Canada Trust branch in Richmond Hill. Ontario, right after I turned 18, I embarked on what turned out to be a lifelong financial career. That career allowed me to soak in a ton of education about financial planning and much more. And the evolution of my career into what I’ve been doing for five years now, helping people with the biggest loan of their lives, has given me even more opportunities to learn about people’s financial choices and resulting situations.

The # 1 most important financial tip

What could be considered the # 1 most important financial tip by various financial experts could vary from “paying yourself first” to “always having an emergency fund” to “making sure you don’t put all your financial eggs in one basket”. So, what would I say is the top advice?

My #1 financial tip? Understand good and bad credit!

As a mortgage professional, one big challenge I see is that most people don’t have more than a very vague idea of what their credit report and credit score looks like. They often aren’t totally sure whether they will be in a position to qualify for the best mortgages. And they frequently have erroneous information about what they should or should not do to make sure their credit is as great as possible. I don’t understand why our schools aren’t more focused on financial literacy. It’s such an important part of our adult lives, and most of us graduate from high school totally unprepared. Arrrgh.

Where to start? Check your credit rating and credit report

Take control of your financial well-being by checking out your credit rating and your credit report. Why?

Your credit history can determine many things, including:

  • Whether or not you qualify for a mortgage
  • Whether or not you qualify for a loan
  • Whether or not you qualify for a credit card
  • Whether or not you can rent a home
  • Whether or not you will be hired for a job

Credit issues that might cause problems

You may be surprised to find out that having no credit is almost as much of a challenge as having bruised credit. What can be a problem is:

  • Not having enough credit in your own name, so it’s hard to tell if you’re a good credit risk.
  • Having credit in your name, but it’s not “good credit”
  • Having errors on your credit report, due to mistakes or identity theft

How do you check your credit?

Don’t be afraid to do this. You have a right to know what’s in your credit report! There is no negative effect resulting from checking your credit yourself.

In Canada, lenders use credit information gathered by either Equifax or TransUnion. The information they have on file is not always the same, so you should check both. You should definitely review your credit at least once a year.

What to look for in your credit report

  • Number of “trade lines” – you want two or more that are in good standing.
  • A credit rating – the higher, the better; you want a number of 680 or higher.

One thing to keep in mind is that time heals all (credit) wounds. Even serious problems like bankruptcy and consumer proposal eventually disappear off your credit bureau.

To learn more about credit:

There are some great sites out there that talk about credit in much more detail. Elsewhere in this site I have a ton of articles as well.

I also really like the in-depth pamphlet Understanding your Credit Report and Credit Score that is offered by the Financial Consumer Agency of Canada. It may seem a little long, but I think you’ll find that it’s a very straightforward read with some great examples.

The website is awesome, with good info about many aspects of finance.

So… take a deep breath, then go to Equifax and/or TransUnion and see what they have to say about you. 

And don’t hesitate to reach out so we can talk about your own plans.

Photo credit: [c] Giuseppe Ramos for

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