How do I get in the game?

During yesterday's introduction, I discussed the ability to earn money on everyday spending using credit card rewards.  Undoubtedly, you're wondering: how do I get in the game?  Before you get in the game, you have to prepare yourself. I'm going to explain some steps to take to get into the credit card rewards game.  As a disclaimer, much of the information in this post will be directed to those who have poor credit or no knowledge of how to maximize credit.  If you don't fall into one of those two categories, you'll find more helpful information in later posts.

In order to be approved for the best rewards cards, you will need to have good credit.   It is vitally important to check your credit report and score before you apply for ANY credit product, credit cards notwithstanding.  I'm sure that you have seen some commercials with some catchy tunes promoting sites that provide free credit scores.  Keep in mind that many of these sites ask you to sign up for credit monitoring services in order to acquire your free report.  Government law mandates that receive one free credit report per year. This report doesn't require you to pay for anything. AnnualCreditReport.com is the site that manages those requests for the US consumer and you can access that site here.   Often, you will be able to access your free credit report right away.  If the site can't authenticate you, you'll have to mail in some requested information in order to receive your report. The address and necessary info will be provided in an easy to understand manner.

Once you have ordered your report, check for discrepancies.  Ensure that you don't have incorrect data, such as accounts that you didn't sign up for or improper collection activity.  Peruse your report and pay special attention to the section that discusses potentially negative information.  Bankruptcy, tax liens, IRS levies, and items of that nature will be found here.  Collections accounts, such as unpaid cable or cell phone bills will be find here as well.   If you have something on your credit report that is incorrect, you can dispute that information through the credit bureau and the organization that submitted the derogatory information.  The bureau will then investigate the matter and contact you through your desired method when they have a resolution.  This process can take up to 3 months, so get started right away.  We will discuss later how to handle negative information that is unfortunately accurate.

Besides your credit report, you will also need know your credit score before you get in the game.  Similar to credit reports, there are several different sites out there that will sell you several different types of credit scores.  The bureaus and other companies have generated scores based on internal models. Examples include VantageScore and Transrisk scores.  These products help you gauge your credit health, but generally aren't the scores used by credit issuers.  Instead,  it's vital that you acquire your FICO score. Equifax and Myfico both sell this particular score.   I have personally purchased a FICO score from  Equifax.  Keep in mind that Myfico is just as reputable, so you rest assured that you are ordering a quality product if you choose that site.

Once you purchase your score, the particular company may offer extras in addition to the actual numeric score, such as simulators and tips on understanding how your score was calculated based on your report.  For instance, Equifax will allow you to estimate the impact to your score if you pay off a debt or all of your bills on time over a specified time frame.

Checking your credit report and score are vital steps to getting you into the credit game.  Even once you are in the game, you should be constantly monitoring both so you can maintain your credit and ability to apply and be approved for the best products and rates.

In part 2 of this post, we will take a closer look at the credit score.  We will discuss the breakdown of the score, how to improve your score, and an acceptable range of scores that allow you to secure the best credit products.