Act Today, Save Tomorrow:
Survey shows we want cheaper interest rates on our borrowing and we know how to get them - but we’re not doing anything about it!
These days, with so much change on the horizon, it’s as important as it’s ever been for us to try and save money wherever we can. This is especially true when it comes to our borrowing because getting the lowest possible interest rates on credit cards, loans and finance can add up to significant savings on how much our credit costs us in the long run.
In a society where borrowing is on the increase, it seems most of us are aware of the best ways to pay less for credit. A recent survey of 1250 consumers carried out by MyCreditMonitor found that over 65% of those surveyed thought that the interest rate they would be charged was either very important, or the most important factor when they were applying for credit.
The survey also found that most consumers are aware of how to get lower interest rates and cheaper credit, with 67% understanding that generally speaking, the better their credit score, the better the deals they are likely to get on the credit that they take out.
More importantly, not only did the survey show that consumers understand how important their credit score is when it comes to paying less for credit, it also showed that most people, nearly two thirds of those questioned, knew that there are steps they can take to improve their credit score.
So, if we want to make sure that we pay as little as possible for the credit that we take out, why do so many consumers seem reluctant to take action?
In another recent survey by MyCreditMonitor, 60% of those asked said they hadn’t actually checked what their credit score was.
One of the main reasons for this amongst those surveyed seemed to be that they didn’t have any immediate plans to apply for credit, with just over 49% saying this was the reason they hadn’t checked their credit score or done anything about trying to improve it. A further 23.6% said that they simply didn’t have the time.
As much as it seems we understand the importance of our credit score and the impact it has on how much our credit costs us, there are perhaps a couple of important considerations being overlooked by many consumers.
Sati Dhanjal, Vice President at MyCreditMonitor explains: “A lot of us only get round to thinking about checking our credit score when we're looking to borrow money, but quite often this can be too late to do anything about it if we see this is low. There are various things people can do to try and improve their credit score, but these can take time to show any benefit.”
“Steps such as ensuring all our details are correct, that there are no credit report errors and resolving any previous errors/issues that consumers could have had with money they may have borrowed in the recent past aren’t things that will have an impact overnight. So whilst a lot of consumers might think that because they aren’t planning to borrow in the near future, they don’t need to worry about their credit score, this could actually be the best time for them to start thinking about improving it!”
“Despite this being the case, a lot of people might feel they simply don’t have the time to check and start improving their credit score - but we think they might be surprised how quick and easy it actually is. We all lead busy lives and this doesn’t need to be another big task to add to our never-ending ‘to-do’ lists. You can set everything up online, and finding out your current score and getting ideas for how to improve it, typically takes a matter of minutes - but it could save hundreds or thousands of pounds in interest over the coming years.”
This small investment in time and effort would certainly seem to be something that would be worthwhile for a lot of consumers. The survey also asked those with credit cards about their monthly payment habits. While just over half of the people surveyed said they paid their balance off every month, 47.5% said they don’t - which could mean they’re paying interest every month, increasing the cost of their borrowing and thereby the time it takes to pay it off.
Taking action now to improve their credit score could open the door to better deals that could help reduce this cost and help them pay off their borrowing quicker.
Sources: MyCreditMonitor, Google Consumer Surveys in September/October 2016
Grapefruit Digital for MyCreditMonitor
Press contact: Matthew Kirkman
Tel: 0208 123 8781
MyCreditMonitor provides you with your credit score and credit report to help you improve your credit management - https://www.mycreditmonitor.co.uk/
Note to Editors
The MCM infographic can be easily embedded using the following code: https://dw3i9sxi97owk.cloudfront.net/uploads/stream/2016/10/87419/21151604/embed-code.txt.