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SATs Keeps its Same Scoring Model + A Scoring Model You Better Understand

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The SATs are changing course following backlash over a plan to assign an adversity score to every student who takes the exam. The original adversity score was made up of ratings for the student’s school and neighborhood environments and was intended to capture the obstacles a student might have overcome. Critics said over-eager parents could use the score to game college admissions. Instead, the College Board will use a different system in an attempt to capture a test taker’s social and economic background. For many SAT scores can make the difference in so many lives but what other score affects your well-being?

Many people are aware of the important role the credit rating plays in their lives. However, understanding what goes into a credit score (the credit score breakdown) might present some difficulty. There are several different methods of scoring, but most lenders and banks rely on the FICO method that has been in existence since the 1980s when it was developed by the Fair Isaac Corporation. The three prominent credit bureaus (TransUnion, Experian, and Equifax) all worked with Fair Isaac to come up with the FICO algorithm.

Your credit score may be any number from 300 to 850. The average American falls at about 690, which is deemed relatively good credit. However, while this score should secure you a loan, it will not get you the very best interest rates on loan. In fact, 300-640 = Bad Credit, 641-680 = Fair Credit, 681-720 = Good Credit, and 721-850 = Excellent Credit. Excellent credit should be the aim.

Following is the credit score breakdown:

Payment History

The biggest chunk of your score (35%) is derived from your payment history. This score is influenced by how well (or not) you pay your bills on time, how many have been sent to collection agencies, bankruptcies, tax liens, etc. Keep in mind that missing a payment is worse than making a late payment and that being late or especially missing a mortgage payment is a bigger blow to your credit score than missing a credit card or utility payment.

Usage Ratio

The amount of debt you have (compared to the amount of credit you have not used) accounts for 30 percent of your score. Try not to max your credit cards out. It is recommended that you only use 25 to 50 of the credit that is available to you. A way to balance this out is to obtain more lines of credit and not use them. However, you do not want to apply for a bunch of credit cards all at once as this is marked against you. If your credit is in good standing, apply for a reputable card every six months or so and save it for a rainy day.

Length of Credit History

Fifteen percent of your credit score is based on how long you’ve established credit. This is common sense. The longer your credit history, the better your overall score will be. More data about your past leads to a more accurate prediction of your future credit worthiness.

Credit Mix

Having several types of credit will actually boost your score if they are managed well. This counts for 10 percent of the overall rating.

New Credit

As mentioned earlier, opening new credit accounts all at once will negatively affect your score in the short term. It’s also important that you are aware that your score can be lowered for too many “hard inquiries” about your status. A “hard inquiry” is one that you have authorized a lender to perform. If you are inquiring about your own score, this will not count against you.

Understanding what goes into the credit score breakdown is the first step in improving your score and what will allow you to design your score and begin you on the journey to financial freedom.

Ash Exantus aka Ash Cash is one of the nation’s top personal finance experts. Dubbed as the Financial Motivator, he uses a culturally responsive approach in teaching financial literacy. He is the Head of Financial Education at BankMobile and Editor-in-Chief at Paradigm Money. The views and opinions expressed are those of Ash Cash and not the views of BankMobile and/or its affiliates.

The Daily Digm (News)

Being Single Is Worth Big Bucks + How to Not Let a Relationship Ruin Your Finances

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Alibaba says its Singles Day event has brought in a record $31 billion in sales. The online retail event, which is now bigger than Black Friday and Cyber Monday combined, is seen by some analysts as a “bellwether of Chinese consumers’ willingness to spend” despite a slowdown in growth, according to CNN. The holiday celebrates people who aren’t in relationships, with other Chinese e-commerce platforms and even U.S. brands also taking part in the world’s busiest online shopping day.

So this now proves that being single is worth a lot of money! And If I can say so personally, being in a relationship and starting a family almost ruined my finances! What do I mean? Let Me Explain… First and foremost, starting a family is one of the best things that has ever happened to me in my life, and anyone who has experienced being a parent will tell you how much joy parenting really is—up to a certain point.

The truth of the matter is that children are blessings and can change your life for the better, but unfortunately, they can also change your wallet in the opposite direction if you aren’t properly prepared.

Love Is in the Air

My wife and I met over 15 years ago, and it was love at first sight. Well, maybe not exactly—I had to convince and woo her a little, but she eventually made the right choice and fell to my charm (or my unwavering persistence). We had a great time dating and rarely discussed starting a family because we were enjoying our lives, careers, and looked forward to more world travel. After five years of dating, we decided to get married and wasted no time starting a family after that. My daughter was born approximately 11 months after our nuptials, and this was one of the best days of our lives. We enjoyed our new family immensely, but soon after, we were hit with the reality of parenting and raising a young child.

Love Didn’t Pay the Bills

Bills started to pile up immediately, and we were left with many tough decisions to make as it related to our priorities. Were we going to pay our medical bills first or use our cash to buy clothing and diapers? Could we afford childcare, or should one of us stay home? Was it time to pick up a second job, or was there another way to bring in more income? The fact that it is expensive to start a family set in pretty quickly.

Love Lowered Our Credit Scores

After months of robbing Peter to pay Paul, we were almost maxed out on our credit cards in an attempt to make ends meet. We watched our credit scores closely and noticed that these high credit card balances had taken a toll on our score, dropping it almost 30 points in a short amount of time. We learned that overuse of our credit cards had taken us way over the recommended maximum utilization ratio of 30 percent.

Love (and a Little Discipline) Fixed It All

Immediately, we started to budget our expenses and focus on our needs rather than our wants. We tightened our belts a little and by doing so we were able to pay down our debt and get our score back on track. We also started to pay ourselves first and created an emergency fund with a high-yield savings account in order to prevent ourselves from being dependent on credit. We focused on our needs and budgeted for the wants, and before we knew it, our ruined finances became a walk in the park of family finances.

The Lovely Conclusion

Starting a family is still our most significant accomplishment, but turning our family finances around is a close second. Never underestimate the power of planning, but also don’t beat yourself up if life throws you lemons—or babies for that matter. Now at child number two, my family finances are growing, and what seemed like an out of control situation was put back in order with a little planning and discipline.

Do you have any financial comeback stories? I would love to hear them below.

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Millennial and Gen Xers Career Ambitions Are Being Put on Hold + How to Make Your Career Move at Any Age

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Millennials and Gen Xers are patiently waiting for their baby boomer bredrens and sistrens (Brother and sister in Jamaican patwoy) to retire so they can plan the big takeover. Still, the problem is they aren’t retiring. According to a USA TODAY/LinkedIn survey, there are now five generations in the workforce, clogging up America’s career ladder and making it difficult for younger workers to move up. Some 41% of millennials say they’ve struggled with promotions because boomers are delaying retirement, leading younger workers to job-hop for bigger titles and higher pay. A tight labor market has also led companies to hold onto older workers.

Can you be too young or too old for a job? Age discrimination is illegal, but we all know some employers may discriminate based on age and try to mask it as something else. While there are no foolproof ways to stop it, there are ways to prepare yourself no matter what. Here are four ways to prepare for the job you want no matter your age:

1. Focus on Your Strengths, Not What You’re Lacking

Whether you are 20 years old or over 40 instead of focussing on your age, you need to focus on your strengths. Many young people with limited experience or older people who may not be up to date with the latest technologies focus on what they’re lacking, and this is a big mistake. Do you have the qualifications for the job? Can you bring value to this position? Whatever your strong suits are, you should play that up in your resume, cover letter, or communications with the recruiter. It’s easy to focus on why you can’t get the job, but the trick is not to let that get to you. Focus on your value!

2. Attack Your Job Search from All Angles

Networking, Answering ads, and/or working with recruiters are the most effective ways to land a job. It is important that you don’t focus on one method but all three. Networking is the ideal way because it allows you to communicate your value directly, but the other methods have their benefits as well. Be proactive and use each method effectively.

3. Show/Explain Your Leadership Abilities and/or Innovation

Leadership and taking the initiative have nothing to do with age. Young leaders and old leaders can be more or equally effective as those who have the “ideal” age. Focus on your leadership abilities, and be sure to display this to your current or potential employee. Also, make sure you are keeping up to date with current trends in your industry. This will allow you to show your innovation and add more value to your company.

4. Ask for What You Are Worth

Lastly, ask for what you are worth. Don’t let being “too young” or “too old” deter you from asking for the salary you deserve. Trying to downplay your worth may very well backfire on you. Also, if you have been with a company for a long time and your salary outpaces what the position is worth, making sure you are adding to your skill set and not staying complacent.

Following these four tips can help you gain or retain employment. What are some other ways? Comment below>>>

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Former Twitter Employees Are Accused of Espianage + How to Protect Your Personal Information from Spies

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Two former Twitter employees have been accused by the Justice Department of using their roles to provide Saudi Arabia with information about American citizens and Saudi dissidents. The charge reflects the first time federal prosecutors have publicly accused the kingdom of running agents in the United States. It also raises a fresh set of concerns about the ability of U.S. tech companies to protect private data against abuse from foreign governments. Twitter said it restricts access to sensitive information to “trained and vetted” employees.

So what does that mean for your personal information? What do you if someone steals your info? First, understand that just because you’re the victim of identity theft due to a data breach, it doesn’t necessarily mean that someone is opening credit lines and cleaning out your accounts. It only means that your data has been exposed; however, there are some steps you should take to ensure that you do not have an identity clone and that your finances are intact.

Step One – Don’t Panic. The first step is not to panic. Thoroughly read your notification letter, which will explain what information is at risk, how the breach occurred, and how you can get more information. Keep it in a safe place in case you ever need to prove that your data was exposed.

Step Two- Change your Passwords. It’s a good practice to update your passwords every 90 days. Be sure to include numbers, symbols, and uppercase and lowercase letters in your new passwords.

Step Three – Contact Financial Institutions. Let your bank, mortgage lender, and other financial organizations know that your data has been compromised. This way, they can keep an eye out for suspicious activity.

Step Four – Monitor Billing and Financial Statements. It’s essential that you’re on the lookout for fraudulent activity, too. Your bank or credit card provider may have text or email alerts to help you monitor your account, but be sure to check your statements regularly. And don’t just look for significant withdrawals. Small purchases could be criminals seeing what they can get away with.

Step Five- Check Your Credit Report. You can get a free credit report once per year. After 30 days, request your copy and check for anything suspicious. For extra protection, sign up for a credit monitoring service. While this typically comes at a cost, the business that exposed your data may offer these services for free in response to the breach.

If you’re a Capital One customer not to worry, they have fixed the exploit the hacker used to access the data and has worked with federal law enforcement on the breach. The banking company said it would reach out to customers who were part of the hack and will offer free credit monitoring and identity protection to those customers affected by the breach.

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