One of the many painful lessons I learned growing up was that you can actually try too hard to save money and end up spending more in the end. Unfortunately, mortgages definitely work this way. If you just focus on getting the absolute lowest rate and/or closing costs, you could end up spending a lot more time and money on your loan in the long run.

Mortgages can be complicated beasts at times; rates can even change in the same day. Because of this, it’s critical that you understand how the whole mortgage process works, especially all of the different costs associated with a mortgage.

I asked Jim Woodworth, one of our mortgage specialist team captains, about the consequences of only looking for the absolute lowest rate. He explains that, “We often find that the lowest possible rate does not make the most sense for most people. The upfront costs need to be factored in to see which option works best in the short term and long term.”

Lots of Costs

Besides paying your mortgage principle – the amount you actually borrowed – and interest, you’ll have to pay taxes and insurance (escrow) along with closing costs. All of these costs will be different based on what type of mortgage you get, the mortgage amount and even who it’s through. Just because you’ve found a lender that offers a lower rate than the competition doesn’t mean that’s the best mortgage provider to go with. There’s more to a mortgage than the interest rate.

For example, when your mortgage servicer charges you a monthly payment, the assumption probably is that the amount you pay includes the interest accrued along with “extra” money to pay down the principle loan amount so that 10, 20 or 30 years from now, you’ll have paid off your mortgage completely.

Interest-Only Mortgages

Sometimes you can get what’s called an interest-only mortgage (a.k.a. exotic or subprime mortgage) where for the first few years you only pay the interest on the loan. This is a lot cheaper, but after the interest-only time is up, you’re going to have a much higher payment to make each month.

People may get an interest-only loan assuming/hoping they’ll get a raise, bonus or better job by the time the interest plus principle payments begin. This type of loan can pose a danger for two reasons.

Since you’re not paying on the principle, if your home’s value goes down by the time you do start paying on the principle, you may end up owing more than your home is worth. There’s also the chance that you don’t get that big promotion you were waiting on, and you’re left with a monthly payment that you can’t afford.

Negative Amortizing Loans

Another type of loan that has an artificially low payment is a negative amortizing loan. An amortizing loan is what you would think of as a “normal” loan. It has a monthly payment that is calculated to pay off the loan in a specified amount of time. A negative amortizing loan doesn’t include interest in the monthly payment so the loan actually gets bigger as you pay on it.

So, now you know, when looking at different rate and loan options, make sure you learn about all the fees associated with the mortgage so you’re getting the best mortgage, not just the best rate. If you’d like to learn more about the different aspects of a mortgage, check out our Know Your Mortgage series!

As always, please jump into the conversation with any thoughts, comments or questions you have.

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Stephanie Halligan is a blogger at The Empowered Dollar. Her mission: saving teens and twenty-somethings from financial disaster, one conversation at a time.

Next to paying for a roof over your head and keeping the lights on, a cell phone bill (and the cell phone that comes with it) is probably at the top of your list as a “necessary” monthly expense.

Whether you just have a cell phone plan for yourself or you’re paying for the entire family, you’re probably one of the 82% of Americans paying for the privilege to talk, text and even surf the web from where ever you want, whenever you want.

But not all bills are created equal – especially when it comes to affecting your credit score. Unlike some monthly expenses, like your mortgage or a car payment, paying your cell phone bill can affect your credit in not-so-intuitive ways. The irony? You likely need good credit to get a cell phone in the first place, but depending on how you pay your cell phone bill, you could either be hurting or harming your credit (or not affecting it at all).

So when exactly does paying your cell phone bill affect your credit score?

Missing a Cell Phone Bill Payment: Hurts Your Credit Score

Like most bills, if you miss a payment or you’re extremely delinquent on settling your bill, you can damage your credit score. Some cell phone companies will switch off your service if you fall behind on your payments; but just because you no longer have a working cell phone, it doesn’t mean you’re off the hook for an outstanding cell phone bill.

In addition to shutting off your service, your cell phone company will likely report your missing payments to the credit bureaus and may turn your debt over to a collections agency – both of which will harm your credit score. And a delinquent account that’s made it to collections can linger on your credit report for up to seven years. The takeaway? Pay your bills on time – otherwise you may find yourself without a working cell phone and a lower credit score.

Paying a Cell Phone Bill on Time: Doesn’t Affect Your Credit Score

So if missing a cell phone bill payment could damage your credit score, paying your bill on time should improve your credit score, right? Not exactly. Unfortunately, if you’re simply paying your cell phone bill each month with cash, by check or by having it automatically deducted from your bank account, it’s not on impacting your credit score. Since the cell phone company hasn’t extended you a line of credit, your on-time payments aren’t on the credit bureaus’ radar.

However, there is one payment method that could actually boost your credit score…

Paying a Cell Phone Bill with a Secured Credit Card: Helps Your Credit Score

If you don’t want to charge your cell phone bill to a credit card (or you don’t have good enough credit to open a card), there is an alternative that will help you build your credit score. It’s called a secured credit card. Similar to a debit card, the amount you can charge to a secured credit card is limited to the amount of money you put down on the card. If you don’t qualify for a traditional credit card, don’t worry – it’s significantly easier to qualify for a secured credit card at a bank or credit union. And the issuer will report your secured credit card to the credit card bureaus, which means you’re building credit history by paying your cell phone bill.

Regardless of how you decide to pay your cell phone bill, remember to pay your bill on time and in full to avoid fees, charges and damage to your credit score.

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Stephanie Diaz is a former public relations specialist. Stephanie is a blogger who shares tips on saving money and getting ahead in any economy.

The next time you withdraw or deposit money from an ATM, be aware that saboteurs may have installed information-stealing devices known as skimmers. For the less discerning ATM user, these skimmers, often in the form of ersatz card readers, may go unnoticed. By educating yourself on oft-used criminal methods of theft, you can detect counterfeit ATM devices, prevent compromised financial accounts and safeguard your identity.

There are many ways to protect against ID theft and ATM fraud. Having an awareness of the ATM’s location, your banking activity and using identity protection services will give you a leg up against theft. Here are a few things to keep in mind when using an ATM to help keep you safe from criminal activity.

Identity Theft

If ATM skimming does occur, your identity is at risk of being stolen. A proactive identity protection service will immediately alert you when suspicious activity is detected. By monitoring your bank account activity and scanning for threats, these services ensure your identity remains solely yours.

Bank Activity

If you don’t use the service of an identity protection service like LifeLock, keep a watchful eye over your banking activity. ATM larcenists who commit skimming crimes are skilled at stealing their victim’s cash. Oftentimes, thieves will subtract small dollar amounts ($50 to $100) at one time in an attempt to avoid detection. Get in the habit of checking and tracking your purchases every day.

Location

The safest ATMs are located inside bank lobbies; they’re more secure and restrict access to only card holders after closing. Tourist areas or ATMs in a large public space are often targets of thieves due to the heavy traffic of users.

Detection

Software expert Tahir Mehmood suggests searching for tapes, threads, thin films or wires along the card slot’s edges. Most skimmers don’t match the ATM’s color scheme and texture. Be cognizant of these other stealthy devices used to steal financial information from right under your nose.

Card Slot

False card slots are often installed in a rush, so they’re not well secured. Tug on the slot; if it seems loose or moves, the ATM is most likely compromised. Remove the skimmer to prevent other ATM users from falling prey. Then report the ATM to the bank or authorities.

Cameras

Installing clandestine cameras on the light above the keypad is another technique executed by thieves. The camera will record card information and your PIN number. To avoid having your sensitive information recorded, use your hand as a visual shield when entering the PIN number from the prying eye of the camera — which will only work if the next method of sabotage is not present.

Keypad

Thieves can install a false plate over the real keypad. Entering your PIN on a fake keypad will sneakily record the keystrokes of your private, four-digit PIN. Thoroughly investigate the keypad for any signs of foul play. If it seems loose or suspicious, leave and report the ATM to the proper authorities.

Always use an ATM with caution. There are some out there who are trying to steal the identities of others so they can profit off of these innocent folks. Have any other suggestions for staying safe at the ATM? Feel free to share with other readers in the comments below!

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Every time I start reading about seasoned assets, my mouth starts watering for some bar-style, seasoned fries, and then I just can’t focus anymore…

Anyway… seasoned assets are a critical concept to understand before you apply for a mortgage. There are two kinds of seasoning we’re talking about, asset seasoning and property seasoning. Property seasoning means you have to have owned your property for a significant amount of time, usually one year.

If you’re trying to refinance in less than a year, your mortgage company will be worried that you might be engaging in a type of mortgage fraud called loan flipping. This is where someone tries to refinance multiple times in a short period of time and then let’s the property go into foreclosure. Asset seasoning is a little more complex, so that’s what I’ll focus on here.

Basically, if your assets, we’re talking large deposits here, haven’t been in your bank account for at least 30 days, then they’re not seasoned, and your mortgage company is going to want to know where they came from and why.

When a lender is considering your application, they want to make sure you have enough money to make your mortgage payment each month without help from family, friends or other types of loans. They’re looking for financial stability and want to confirm you’re not borrowing money on the sly that might affect your ability to pay your mortgage.

I asked Jim Woodworth, one of our mortgage specialist team captains, about seasoned assets, and he broke it down really well:

“As long as the assets can be documented, you’re generally in the clear. For example, if you get a bonus from work or you get a tax refund, those are assets that still can be used. However, if you keep cash in your sock drawer or a safe at home, those assets would not be considered for the mortgage application. If you do keep cash in places other than a bank account, you will need to deposit those assets into an account as soon as possible to be considered for future mortgage applications.”

So, if you’re thinking about applying for a mortgage, plan ahead with your finances. If you do keep money in your home, you’ll want to deposit it right away and wait a while before applying so that money will count as seasoned assets and help you qualify for a mortgage. Or, if you don’t want that money to be counted, don’t deposit it in your bank account until after you’ve closed on your loan at the least.

Like Jim says, any legitimate deposits made in the last few months should be ok, but you’ll have to provide asset statements to show the source of those unseasoned assets.

Have any questions about asset seasoning or other aspects of the mortgage process? Ask away!

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Dona Collins is a personal finance specialist with experience working in the insurance/finance industry – industries where your credit score can sometimes impact your job prospects. Tread carefully and know your rights so that you aren’t taken advantage of or find yourself losing out on job prospects! Read more of Dona’s work at Quizzle.com.

You already know that credit affects your ability to buy a home or a car, but did you know it could prevent you from getting a job as well?

Even worse, the people who are most vulnerable to “credit discrimination” are unemployed and often have bad credit as a result of their loss of income. Remember that when employers are looking at a credit report, they just see negative items without any context to explain them.

Credit eligibility is not just a problem for those who are applying for financial jobs either. People who apply for high-level management positions and others who have access to sensitive employee data, such as Human Resources personnel, are likely candidates for credit checks as well. The best thing you can do is to be proactive and clean up your credit reports before you are in a situation where getting a job depends on them.

Be Informed

Obviously, the last thing you want to do is go into a potential credit check situation blindly. Even if you have some idea of your reports are like, request copies of your credit reports so that you know exactly what you’re dealing with. It is important to pull credit reports from Equifax, Experian and TransUnion because each one may have differences. Additionally, not all creditors report to all three agencies on the same schedule. Since you never know which one(s) a prospective employer might pull, leave no stone unturned. It might seem tedious, but you need to know as much information about your credit history as possible.

Scrutinize Your Information

The first thing you want to look for is mistakes. Experts have estimated that as many as one out of every four consumer credit reports contains inaccurate or false information. Make sure all the accounts listed belong to you. If an account has been paid off, but the credit report is not reflecting that, contact the credit-reporting agency to get that information updated. Verify that your address is consistent across all three reports as well. It may not seem like a big deal, but it looks shady if your previous addresses don’t match up. Make sure your contact information is also up-to-date because you are better off to try and negotiate with creditors than to avoid them.

Dispute Any Errors

Once you have identified misinformation, the next step is to dispute each item. Unfortunately, this can be a very time-consuming process because the credit bureaus have to first verify that that your claims are legitimate and then update your reports. This is why it is imperative that you monitor your credit report. Quizzle.com provides you with your full Experian credit report and score every six month, completely free of charge.

Find the Outstanding Collection Accounts

One of the biggest things employees are going to look for is debts that are still actively in collections. Medical bills, home foreclosures and settled accounts do not matter nearly as much to employers as past due credit cards or loans that you still owe. Contact your creditors and try to negotiate settlement amounts that you can reasonably pay off. You may even want to consider getting a loan if you can’t come up with the money to pay the accounts off on your own. Remember, employers are not looking at your actual credit score, just whether or not you have delinquent payment problems.

Open a New Line of Credit

If you have the ability to get a new credit card, even if it is just a secured credit card, then take the opportunity and start building a new line of credit. Admittedly, it takes a minimum of six months to one year to establish a good payment history, but it will help show potential employers that you are responsible and can manage credit wisely. Whatever you do, do not max out the card and then make minimum payments. That won’t help you. Make small purchases and pay them off every month without fail. The other option, mentioned earlier, is that if you get loan to pay off accounts make sure that you make your loan payments on time every month.

Prepare to Explain Yourself

According to a 2010 report by the Society of Human Resource Management, 87% of employers will allow applicants the chance to explain their credit problems in some cases. If you have tried everything you can do to “clean-up” your credit reports and you still have accurate, negative information than at least be prepared to tell an employer why. Identity theft, divorce and losing your job are all legitimate reasons why your credit report might have some serious dings. Telling the employer that you just spent more than you could afford is probably not a good idea. Don’t lie, but if the true story hurts their impression of you more than it helps, then skip it.

Many people legitimately argue that a person’s credit history is not a fair way to assess their character or their ability to be a great employee who does their job well. No matter how true that may be, company policy is what it is. Companies do have to ask for your consent to check your credit, but if you don’t give them your permission, you might as well be turning the job down because a denial will stop the hiring process in its tracks.

Some states like California, Connecticut, Illinois, Maryland and Hawaii do have laws that restrict the practice of companies pulling credit reports; however, many of these laws have exceptions that employers can creatively work around. Just because you live in a state that has laws restricting this practice, don’t assume it won’t happen to you. Rather than make yourself vulnerable to the company’s policies, polish your credit report as thoroughly as you your resume.

Read the original article here.

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Last week in Mortgage Missteps, I talked about why you should check your credit score before you apply for a mortgage. This week, I want to discuss some actions that will hurt your credit score, even when it might seem counterintuitive. Once you’ve applied for a mortgage, you don’t want to do anything that will affect your credit score, especially by lowering it so much that you no longer qualify for the mortgage.

Mortgage lenders look at a complex variety of factors when deciding if they can/should give you a loan, and many lenders will often pull your credit a second time right before you close to make sure nothing’s changed. Anything that alters your credit score is a red flag for a lender which could cause them to view you as a higher risk. Read on to learn what affects your credit score and how to avoid damaging it.

Don’t Open New Lines of Credit

Opening a new line of credit, whether it’s a credit card, car, furniture financing or even a home equity line, involves a credit check which lowers your credit score because you’re assuming more debt. This can lower your credit score so much that you no longer qualify for your mortgage, but it can also be a cause of concern for your prospective mortgage lender because, now that you have more debt, you might not be able to afford your new monthly mortgage payment.

Another problem with opening a new credit card is if you don’t use it – or one of your old cards – regularly, your lender will view that unused line of credit more as an unsecured loan, and this could significantly hurt your mortgage application.

Basically, once your lender has pulled your credit and accepted your application, don’t make any financial changes in your life. Just keep paying your bills as you normally would.

Don’t Close Existing Credit Cards/Pay Off Car Loans

Now this might sound counterintuitive, I mean, wouldn’t a mortgage lender want you to have as little other debt as possible when you get a mortgage? Doesn’t paying off debt drive up your credit score?

Well, not really.

One of the factors a mortgage lender considers during a loan application process is your debt-to-earnings ratio. Generally speaking, you don’t want this to be more than 30%; so, if you only have one credit card, but you only have 50% available credit, your credit score will be less. The ideal situation isn’t that you don’t have any credit cards, but that the balance on your cards is relatively low. If you manage to pay off a credit card shortly before you apply for a mortgage, it’s best to keep that card and use it moderately.

Besides providing more available credit, an older credit card gives you a longer, more reliable credit history. If you keep one or more cards that you’ve had for a longer period of time, and you’ve always been good about making regular payments on it and not maxing it out, that shows your lender that you’re responsible with your debts which, in turn, makes you a much lower risk for them.

Along with older credit cards, you definitely don’t want to pay off a car loan. Again, it would seem to make sense that if you get rid of other debt you’ll be in a better position to pay off your mortgage, but it actually has a bad effect on your credit score because it significantly alters your payment history. Your score can actually drop several points from a move like this, which might prevent you from qualifying for that mortgage altogether.

Applying for a mortgage can seem like a complicated business, but just try to educate yourself, know what you’re getting into and plan ahead.

Let us know of any questions, comments or suggestions you have!

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Hayley Bierkle is a writer for Quizzle.com. Hayley’s posts offer excellent insight into financial responsibility along with a wide array of other finance-related topics.

If you watch The Discovery Channel as much as I do, then you’re probably a “Mythbusters” fan. And, if you’re as much of a fan as I am, then you’ve learned the truth about heated Jawbreakers exploding in your mouth, or you won’t lose your head if you happen to forget to turn off the ceiling fan while changing a light bulb. While all of this might be great fantastic cocktail party conversation, these little factoids probably won’t help you improve your personal finances.

However, what will impact your wallet is what you may, or may not, know about your credit score. Your credit score is a triple digit representation of your credit worth, or how likely your are to pay back money you borrow.  It may seem pretty easy, but credit scores aren’t always intuitive. And that’s the rub, even when you think you’re doing the right thing for your finances, you may actually be shortchanging your credit score.

Let’s get down to business, here are the top 10 credit score fictions on which you need the facts…

More Money Earned Means Higher Credit Scores

The fact of the matter is your income has absolutely nothing to do with your credit score or credit report. Remember, your credit score is a reflection of your ability to pay your bills on time, not a representation of the state of your wealth.

Once You’ve Settled a Debt It Drops Off Your Credit Report

Unfortunately, bad information, late payments and other dings on your credit report linger for up to seven years from the initial date of the “infraction.” Bankruptcies are another matter and tend to stick around for 10 years from the filing date. While these kinds of black marks continue to sully your credit report, their affect on your credit score will be reduced over time once corrected.

Credit Bureaus Are Accurate All the Time

It may surprise you, but MOST credit reports contain a serious error or some type of mistake – eight in 10 in fact. This is why we’re always preaching about checking your credit report regularly and disputing inaccuracies as you find them. To take a look at your credit report and score for free, and dispute credit report errors online, visit Quizzle.com.

Cash-Only Policies Will Help Your Credit Score

In order to have good credit you have to use credit, and use it responsibly. If you don’t have credit cards, loans or other mechanisms by which credit bureaus can judge your ability to repay debt then you won’t have much of a credit score.

Credit Reports and Credit Scores Are the Same Thing

There are three credit reports that matter – your Experian, Equifax and Transunion credit reports. There are so many different calculations of your credit score it would take too long to list them all. As a matter of fact, even FICO has more than 40 different versions. As such, the information on your credit reports and the resulting credit scores can vary – sometimes widely. One is not better than other, lenders use different scores and reports for different reasons. What does matter is how you manage your credit and build a solid credit history.

Managing Your Checking, Savings & Investment Accounts Impacts Your Credit Score

This works the same way income does. Your checking, savings and investment accounts are not reported to the credit bureaus and will not impact your credit.

Closing Your Credit Card Accounts Improves Your Credit Score

This is where things get a little more complicated.  When you close a credit card account it may affect your “credit utilization.” Credit utilization is how much credit you have (or the limits on your cards) compared to the amount of credit used (your balances). Closing one of your cards lowers the amount of available credit and if you carry balances on other cards it will then hurt your utilization percentage, thus lowering your credit score. At Quizzle, we recommend keeping your utilization around 30%.

Pulling or Looking at Your Credit Report Will Lower Your Credit Score

There are two different kinds of credit inquires – soft and hard. When you pull your credit report for your own purposes, it’s categorized as a “soft inquiry” and does not affect your credit score. On the other hand, when a creditor or lender pulls your credit report to approve you for a loan, it is categorized as a “hard inquiry” and has a small, but negative impact on your credit score. This shouldn’t discourage your from borrowing money, but it is something to consider next time the cashier at Kohl’s asks you if you want a Kohl’s card.

Missed Payments on Bills or Debt Not Generally Reported to Credit Bureaus Doesn’t Affect Your Credit Score

First, any time you pay a bill late, or don’t pay for that matter, it can be reported to the credit bureaus. There is no standard policy for all companies as to when, if, or even how often they report late payment or negative information. Despite the inconsistency, just because you’ve never seen a particular bill listed on your credit report, it can still hurt your credit score if you don’t pay it on time.

Disputing Accurate Info on Your Credit Report Will Remove It

Errors and inaccuracies is the only information on your credit report that you can dispute. Once you’ve filed a dispute, the credit bureau, by law, has 30 days to investigate that error. If they find your dispute to be valid, they will remove the inaccurate information. If, however, the dispute claim is found to be false, the information in question on your credit report shall remain intact.  Don’t believe the credit repair hucksters that tell you they can remove correct, but negative information from your credit report – it’s illegal and a scam.

For more tips and tools to help you manage your home, money and credit – including the most affordable credit monitoring on the web and complete identity theft protection – visit Quizzle.com.

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If you’re like many people these days, you’re thinking about refinancing or buying a new home; there’s probably about one million things you’re mentally juggling right now. Not to stress you out even more, but before you get too busy thinking of how you’ll spend the money you’ll save from a refinance or what your dream home looks like, stop and double check that you’ll actually qualify a mortgage.

Obtaining a mortgage is a complicated business, and there are a plethora of factors that, well, factor into qualifying for a mortgage such as setting your limit, your rate, etc. One of the big indicators of what you’ll qualify for is your credit score. This is one of the initial pieces of information a lender will use to determine if they can help you.

I want to stress that there are a lot of different things mortgage lenders look at, so don’t go telling people that I told you anything crazy like as long as your credit score is at a certain mark you can get a million dollar loan or something like that.

That being said, your score is a good indicator of what kind of financing you’ll be able to get. One way to start off on the wrong foot is to apply for a mortgage without having an idea of where your credit is at.

And, contrary to popular opinion, a soft credit pull – the kind you’d be doing if you were just checking up on your credit yourself – won’t negatively impact your score.

It’s a good rule of thumb to check your credit score on your own about once a year, but you’ll want to check it a few months before you apply for a mortgage so that you’ll have time to build it up if it’s too low.

How Credit Reports Work

There are three main credit reporting agencies (CRAs): Equifax, Experian and TransUnion, which all collect credit information including your payment history, the length of your payment history, how much debt you have, how much credit you have available and what your monthly debts are. CRAs don’t decide if you have good credit or not, they just collect all of your information.

There are different ways that your credit score is determined from the reports. The most common formulas were developed by the Fair Isaac Corporation. You’ve probably heard of a FICO score, and this is where it comes from.

If you find what you believe is an error on your credit report, you can dispute it to make sure your credit reports are correct so you have an accurate credit score.

Check Your Credit Score

There are a lot of different companies that will generate a credit score for you. Quizzle.com is one very reliable website for checking your credit. It offers free credit reports and scores, helps you to understand what everything means and helps you build your credit.

Quizzle.com’s CEO Todd Albery explains that maintaining your credit is really important, stating that “At Quizzle.com we believe it’s important for you to have a complete understanding of your credit report and score before entering the mortgage process. Make sure that your report is 100% accurate and that you are in the best position to take advantage of today’s great rates.”

Once you get your score, it’s important to understand what that number means for you, and, if it’s low, how to boost it. Generally speaking, 580 is the absolute lowest score you can have and still qualify for a mortgage – an FHA mortgage, specifically. Usually, you need at least a 620 to qualify. If you’re up at 720 or higher, you’ll get into a lower mortgage rate bracket because you’re seen as a pretty worth-while risk for the lender. 780 is a great credit score and 850 is about as good as it gets.

If your credit is not so hot, there are a bunch of things you can do to get it up like pay off outstanding debts, make sure to pay all of your bills on time and consolidate debt so it’s easier to pay off. Keep in mind, though, that just getting rid of credits cards won’t necessarily boost your credit and could actually hurt it as author Christine Bilger explains.

If you have some questions that aren’t answered here, or you’ve got some other great tips for maintaining your credit, share them with us below!

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Nobody likes wasting money, do they? Actually, according to a news report from Moebs Services, banks, credit unions and thrift institutions made $32 billion on overdraft fees in 2012. That’s right, $32,000,000,000! That’s a lot of zeros.

The 2012 numbers represent an increase of $400 million, or 1.3% from 2011. If you think last year’s number is staggering, it still falls short of the record $37 billion in fees set in 2009. However, at its current rate, Moebs predicts a new record-high will be set at the end of 2016.

So, if you break down the population, how much did the average American pay? Well, considering there are approximately 330 million Americans, the average American paid about $100 in overdraft fees in 2012. If you break down the population by age, keep in mind that roughly 100 million Americans are outside the legal working age and are unlikely to contribute to the statistic. This means that the average working-age population paid close to $400 a year in overdraft fees.

Perhaps what’s even more unsettling is the rise in overdraft spending isn’t due to an increase in the price of the fee. Instead, it’s resulted from a greater number of overdrafts. Of the approximately 38 million people who have a consumer checking account, the Moebs study found that the median overdraft is about $40.

Apparently people really do like wasting money. If you fall into the category of someone who has been charged an overdraft fee, there are ways to ensure it doesn’t happen again. You can start by checking your account statement on a regular basis. In today’s world of smartphones, this task can be done in a matter of seconds without a trip to the bank or an ATM.

There are many ways to overdraft your account. The most common way is to withdraw more money from your account than you have. You can opt in for overdraft protection, which will allow you to withdraw the money and then pay a fee later on. If you decide against opting in for overdraft protection, your transaction will be denied.

While overdraft protection can be useful in some cases, a recent study by the Pew Charitable Trusts found that 54% of the customers who had overdrawn their accounts did not realize they had signed up for a service that cost money. Do you fall into this category?

Be sure to check with your bank about overdraft penalties and if you are signed up for overdraft protection. Do you think overdraft protection is worth paying the hefty fee? Let us know in the comments below!

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Miranda is a freelance writer and professional blogger specializing in financial topics. Her work has appeared in numerous media, online and offline. Her blog is Planting Money Seeds.

By now, most of us know that a credit score matters when you’re looking for a loan. If you want approval for a mortgage, or the best rate on a car loan, you need a good credit score.

But, if you’re not planning to borrow, your credit score doesn’t matter, right?

Wrong.

A credit score is such an easy way for financial service providers to get an idea of what your financial picture looks like that many of them are turning to credit scores for items that aren’t strictly related to borrowing money. Here are 4 non-credit ways your credit score matters:

Monthly Services

The last time I signed up for a satellite TV service, the representative asked me for permission to check my credit score. My credit score was also checked when I changed Internet providers. Many cell phone providers also check your credit before letting you sign up for monthly services.

Many service providers want a general idea of how reliable you’re going to be with your payments. While you might not be rejected because of a low credit score, you might have to pay for your services up front, rather than at the end of the month, or you might be required to make a security deposit.

Insurance

Your insurance provider might check your credit score for help in setting your monthly premium. This is especially common with auto insurers. Many insurers equate a good credit score with responsible behavior in other aspects of your life. As a result, you might save between $10 and $30 on your monthly premium. I have a savings of a little less than $20 a month on my auto insurance, thanks to my credit score.

Banking

Not all banks check your credit score as a requirement for opening an account, but some do. That’s right: Even if you just want a checking account and aren’t trying to borrow money, a bank might pull your credit score. In some cases, it’s possible to be rejected for opening a deposit account because of a poor credit score. Before you decide to open an account, find out what the bank’s policy is on credit checks; if you’re concerned, think about trying a different bank.

Renting

Many landlords have started checking your credit score before deciding to approve your rental application. Poor credit might be a red flag to a landlord that doesn’t want to worry about trying to collect rent from you each month. In some cases, you might have to pay a higher security deposit if you have poor credit.

What About Employers? Can They Check Your Credit?

Technically, a potential employer isn’t supposed to check your credit score. However, employers can get a special version of your credit report as part of a background check. You have to give your permission for such a credit check, but if you refuse, the employer might think you have something to hide.

With some jobs, employers want to make sure that you won’t be vulnerable to bribery due to a difficult financial situation. Additionally, some employers worry about embezzlement from employees with credit problems. It might not be fair, but it’s becoming part of the process.

Bottom Line

Your credit matters — even if you aren’t planning to borrow money anytime soon. Your credit situation is of great interest to a number of service providers, and you might be judged on your credit history for any number of reasons.

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