The Budgetnista Tiffany Aliche Reveals How Her Credit Score Went From 547 To 800+
As women in and out of the workforce, we have made tremendous strides. We've conquered everything from becoming our bosses to leadership roles where we've learned how to manage our own teams and work within the parameters of a company's budget. Yet, there's one thing that we have quite mastered yet--managing our own money.
That's right, we live in a time where we spend way more than we make--pushing aside bills and other necessities for that limited edition designer bag, or swiping our credit card every chance that we get, thus putting ourselves in more debt and sitting on a pathetic credit score that will do more harm than we can imagine.
Learning financial literacy is very important, and practicing good financial behavior can help you live the type of life you desire. Yet women of color and millennials typically overlook their dwindling bank accounts and do not educate themselves. It is only when we experience a financial hardship that we take a closer look at our finances and try to make improvements. Sometimes when this happens, we have dug ourselves in a low ditch, and while it is not impossible to get out of it, it is definitely harder.
I recently sat down with Tiffany Aliche, who is a financial guru and well-known as The Budgetnista to discuss how she went from having a 547 credit score to a score over 800 (she also saved $40,000 when she was only making $39,000 a year!), and her tips on saving, budgeting, and on building wealth:
You Can Easily Lose 40 Credit Score Points In Just One Week
At the age of 23, I had a credit score of over 800, which is an A+. A few years later, the recession hit. I lost my job, and I couldn't afford the mortgage or pay my bills. Since I wasn't paying my bills, my credit score dropped. People don't understand that your credit score is like your GPA for how you deal with money. When you don't pay your bills, your GPA drops. My credit score quickly dropped from 800 to 547 which is like a D-.
One thing that people don't realize is that 35% of your credit score is your payment history - so in other words it is contingent upon if you pay what you are supposed to pay. To rebuild my credit score, I worked hard to pay off credit cards in full at one time. When you do, it makes your credit score jump like Jordan. If you just pay the minimum amount on your bills, your credit score will do a slow climb. But if you want to make your credit score jump like Jordan, pay off a small amount of your credit card each month. I don't know why, but credit card companies care less about the amount you pay, and more about your habit in paying.
So if you pay off something in full, they are wowed. It doesn't matter if you have $8 on the card, if you pay it in full, it will make a difference. So when I figured this out, I put Netflix on one of my credit cards that didn't have a balance, and I paid it in full every month. Netflix would charge my card $8 bucks, and then I would pay them $8 bucks each month and I would see my score go up. So then I decided to do two cards like that. I had Netflix on one, and my gym membership for $20 bucks on the other. So every month, I was paying off 2 cards in full. And within a year and a half, I went from 547 to 750, which is a solid B/B+.
You Can Inherit Good Credit From Other People
To build good credit, you can be an authorized user on someone's card that has great credit. Basically what that means is that they can add you on their card as an authorized user, and you can inherit their good behavior because whenever they pay their bill, it will reflect positively on you. The primary credit card holder doesn't have to actually give you the card either - although as an authorized user you could get one.
Even if the primary credit card holder decides to stop paying their bill, it won't mess up your credit as an authorized user. That's the beauty in it - you only inherit the good credit, not the bad.
You Can Get A Secured Card When You're Young To Build Credit
When you are young, it is unlikely that you will be able to get a regular credit card because you probably will have no credit history. No credit history in the credit world is just like having bad credit or being considered a bad driver because you have no driving history. You haven't proven yourself.
To start building up your good reputation, go to your bank and ask if you can apply for secured card. A secured card is like a credit card with training wheels. The way it works, you give a bank anywhere from $300-$600 and they place it in a savings account for you. Then they give you a credit card that has that amount on it as your credit limit - so basically you are borrowing from yourself. So if you don't pay your credit card, it will take away the money that you have in your savings account. If you treat this card right, and you pay your bills when you should, they will take the secured card away and make it a regular credit card.
You Should Have At Least 3 Bank Accounts For Your Money
I recommend having at least three accounts - one just for your bills, another for spending, and then the third for savings. The account for spending should be attached to your debit card, and then the account for your bills and the account for your savings should not be attached to your debit card.
If you have the direct deposit option through your job, have your money automatically transferred to each account. Your employer may not tell you, but you can have more than one account connected with direct deposit.
Having An Online Bank Is A Must
I recommend having an online bank for your savings account because it makes your money inconvenient, and inconvenient money gets saved because it is not easily accessible. If you want to rate an online bank, go to magnifymoney.com and you can check out reviews and information on the bank.
I always tell people to have a regular bank for ease of use, an online bank for savings, and then a credit union. Credit unions are great because they will give you the best interest rates. Most credit unions are nonprofit, which means the interest that they ask you to pay is just to keep their lights on so the interest rates are lower than other banks.
Ask About Your 401K Day One Of The Job
On your first day at work, before you get into the swing of things, ask about 401K matching. Better yet, ask about this during the interview and see if the company offers it. For your retirement, many companies will match up to a certain percentage of your income that you deduct from your paycheck for retirement. So if you put 3% of our paycheck down for retirement, your company may match it. With some companies they tell you that you have to wait to be vested (usually 30 days or more) to reap this benefit, but you may can start it early if you ask.
In College, Stay Away From Private Loans Because They Are The Devil
If you get a private loan and miss one payment, you immediately fall into default. Default is on the same level as foreclosure or bankruptcy and we all know bankruptcy is like having a big, black F on your credit report. If you fall into default, it will prevent you from getting a car, an apartment - you name it. Also with a private loan, you will likely have to have a co-signer, so if you miss a payment and fall into default then your cosigner is also affected.
If you get a federal loan, you have to miss nine payments to get you to the default stage. One other thing about federal versus private loans is if you fall into a financial hardship, the federal loans will help you out and will be more understanding. But with a private loan, somebody could die and the money would still be due - they would just reach out to the consigner for the money.
You Can Get Paid To Shop
When you are in school, began saving early and get in the UPromise program. It is free to use! What I love most about it is that you can go online and sign up and then your register all of your debit and credit cards, and every time you use your registered debit or credit card at a partner store you will get cash back for your student loans. With UPromise, if you don't use it for your student loans, you can ask them to just cut you a check.
Also, whether or not you are in school, sign up for Ebates. Whenever you want to buy something online, type the store name in Ebates (it could be Target, Groupon, or whatever), and then Ebates will take you to their site and will record how much you buy and give you cash back.
Learn How To Live Off Less Than You Make
After you graduate from college, live a simple life. That can be getting a roommate or getting a used car, just learn how to live simply. If you don't, you will be forced to work a job you probably hate just to make enough money to afford your lifestyle.
Now that you know some of the secrets on budgeting, saving, and building wealth, implement these steps today and hold yourself accountable. An easy way to learn more financial tips and hold yourself accountable is through Tiffany's Live Richer Challenge and through her book The One Week Budget. In her book, she teaches us how to make responsible, financial decisions, while living a life that we desire. The Live Richer Challenge is a FREE, online financial challenge that can help you achieve your financial goals in just 22 days.
Tiffany created this program last year, and her goal was to have 10,000 women signed up and to help them master their money effectively and efficiently. In the end 20,000 people signed up and collectively all of the women saved 4 million dollars and were able to pay off over half a million dollars of debt together.
Women of color make up 70% of buying decisions, so it is time to change our mindset and change our financial situations. Let's start today and build a culture of wealth!
Related Post: 4 Lessons I Learned After Climbing Out Of $35,000 Debt While Making $12 An Hour
- I Paid Off $40K of Debt in 18 Months - xoNecole: Women's Interest, Love, Wellness, Beauty ›
- Ways To Rebuild Credit Score: 7 Strategies - xoNecole: Women's Interest, Love, Wellness, Beauty ›
- How to Fix Your Credit - xoNecole: Women's Interest, Love, Wellness, Beauty ›
- How To Buy A House With Bad Credit - xoNecole: Women's Interest, Love, Wellness, Beauty ›
Brittani Hunter is a proud PVAMU alumni and the founder of The Mogul Millennial, a business and career platform for Black Millennials. Meet Brittani on Twitter and on the Gram at @BrittaniLHunter and @mogulmillennial.
ItGirl 100 Honors Black Women Who Create Culture & Put On For Their Cities
As they say, create the change you want to see in this world, besties. That’s why xoNecole linked up with Hyundai for the inaugural ItGirl 100 List, a celebration of 100 Genzennial women who aren’t afraid to pull up their own seats to the table. Across regions and industries, these women embody the essence of discovering self-value through purpose, honey! They're fierce, they’re ultra-creative, and we know they make their cities proud.
VIEW THE FULL ITGIRL 100 LIST HERE.
Don’t forget to also check out the ItGirl Directory, featuring 50 Black-woman-owned marketing and branding agencies, photographers and videographers, publicists, and more.
THE ITGIRL MEMO
I. An ItGirl puts on for her city and masters her self-worth through purpose.
II. An ItGirl celebrates all the things that make her unique.
III. An ItGirl empowers others to become the best versions of themselves.
IV. An ItGirl leads by example, inspiring others through her actions and integrity.
V. An ItGirl paves the way for authenticity and diversity in all aspects of life.
VI. An ItGirl uses the power of her voice to advocate for positive change in the world.
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Growing up in Brooklyn, New York, Caribbean culture has always been all around me, from the food to the dancehall and soca music to traditions carried out by all of the Caribbean people living in the city. As a youngin, I loved attending the West Indian Day Parade every September because the floats, steel drums, extravagant feathers, and upbeat music made me feel free and gave me a deeper appreciation for the culture.
As I got older, I learned that the yearly Carnivals happening across the Caribbean put NYC’s little festivities to shame. Traveling to the islands themselves and experiencing the people and culture first-hand really gives you a deeper understanding and appreciation for Caribbean culture.
The history of Carnival celebrations in the Caribbean can be traced back to enslaved people who were forbidden from participating in the Pre-Lenten celebrations and thus created their own celebrations and traditions, which over time developed into celebrations of freedom and rebellion. Each country in the Caribbean has its own unique history of celebrations, as well as its own Carnival traditions that set it apart from other festivities.
What started as a Pre-Lenten celebration is now celebrated during a range of months throughout the year and now attracts hundreds of people from all over the world. Here are six carnivals that you should go to this year to experience this culture for yourself.
Crop Over - Barbados Carnival
Crop Over Dates: July 31, 2024 - August 6, 2024
What better place to celebrate carnival than the home of our Bajan Queen Rihanna? While some festivities start as early as May, the official festival season in Barbados starts in July and ends in early August. Crop Over originally started as a way for plantation workers to celebrate the end of the sugarcane harvest season and has now evolved into a much larger celebration. Crop Over is a blend of both old and new traditions, such as the Ceremonial Delivery of the Last Canes, and Cohobblopot, where bands show off their beautiful costumes and play soca and calypso music.
All of the week's festivities culminate with the Grand Kadooment, Crop Over’s big parade featuring all of the bands and droves of people taking to the streets in their beautiful costumes and dancing to the local music.
Other things to do: Visit Hunte’s Garden in Joseph’s Parish and find peace in the picturesque garden while spotting an array of different birds and animals. If you’re looking for beach relaxation, spend a day at Carlisle Bay, the perfect beach for swimming, taking in some sun, and a possible turtle sighting.
Saint Thomas Carnival
Saint Thomas Carnival Dates: April 28, 2024 - May 5, 2024
No passport? That won’t be a problem for U.S. travelers looking to get in on the carnival experience. Saint Thomas, one of the three U.S. Virgin Islands, is known for its crystal clear beaches, scuba diving scene, and overall vibrant culture. The island celebrates its carnival in late April and features a dynamic lineup of events including colorful adult and kiddie parades, calypso competitions, and street parties. Virgin Islanders are known to love to party, so make sure to fill up before the festivities with some local favorites like johnny cakes, callaloo, and conch fritters.
With its rich cultural heritage and lively atmosphere, this is a carnival experience perfect for a first-timer who wants to ease their way into the lifestyle.
Other things to do: Visit one of Saint Thomas’ many turquoise blue beaches such as Coki, Magens Bay, Brewers Bay, or Lindquist Beach. Coki Beach is perfect if you're looking for a more lively experience and want to snorkel without swimming far out, and Brewers Bay is best known for the sea turtles that you can see from the sand. You can also take a short ferry over to Saint John, another of the Virgin Islands, and spend a day at Lime Out, a floating taco and margarita bar.
Spicemas - Grenada Carnival
Courtesy of Grenada Tourism Authority
Spicemas Dates: August 7, 2024 - August 14, 2024
Grenada, also known as the Spice Isle due to its production of a variety of spices, has one of the most anticipated carnivals every year. During Spicemas, revelers hit the streets for lively music, paint, oil, dancing, and good times. One of the most important aspects of Spicemas is Jab Jab, a celebration that involves covering one's body in black oil or paint. This tradition started as a post-emancipation masquerade, in which former enslaved Africans would paint themselves black emulating a “Jab” derived from the French word diable, which means devil.
This was a way of mocking their former masters and also represented rebellion and freedom. Since then, the tradition has evolved into a staple of Carnival on J’ouvert morning, a celebration of freedom, and undoubtedly an element that makes Grenada stand out from other Carnivals across the diaspora. Outside of J’ouvert, Spicemas is a beautiful culmination of colorful and vibrant costumes, steel band competitions, delicious rum, and music that you’ll dance to all night.
Grenada is celebrating 50 years of independence this year, so just know that Spicemas is going to be extra special!
Other things to do: For the ocean lovers, the Molinere Bay Underwater Sculpture Park is a must-see attraction. It is the world's first underwater sculpture park and a popular excursion for folks visiting the island. This year, five new installations are being added to the park, which can all be viewed through snorkeling, diving, or a glass bottom boat ride.
Antigua Carnival
Antigua Carnival Dates: July 31, 2024 - August 7, 2024
Every August, carnival lovers flock to the beautiful island of Antigua for its annual carnival festival. First celebrated in 1957, Antigua’s Carnival started as a celebration of emancipation from slavery and has since expanded into a dynamic showcase of local talent, music, and cultural pride. Some events to look forward to are the Party Monarch and Calypso Monarch competitions, as well as the Caribbean Queen’s Competition.
Antigua Carnival is an almost two-week extravaganza that leads into J’ouvert on Carnival Monday and the main parade on Carnival Tuesday. If you love good music, vibrant costumes, and delicious food, this is the carnival for you.
Other things to do: Take a trip to Shirley Heights Lookout for live music and breathtaking panoramic views of the coastline and ocean. And with 365 beaches in total, you’d be missing out if you didn’t fit in a few on your itinerary.
Bermuda Carnival
Bermuda Carnival Dates: June 12, 2024 - June 17, 2024
Also known as Heroes Weekend, Bermuda Carnival may be smaller than some of the other carnivals, but is still a great time. Bermuda is one of the newer carnivals, originating in 2015. Celebrated in June, this long weekend of festivities draws inspiration from other popular carnivals while also highlighting elements of Bermudian culture. You can expect some similar elements as other countries such as daily fetes, soca music, and a parade filled with different bands and extravagant costumes.
They also celebrate Bermuda’s National Heroes during carnival with a national feast. Bermudians have immense pride in their country and culture, and their carnival is the biggest celebration of the year that you don’t want to miss.
Other things to do: Take a day trip to Crystal and Fantasy Caves, beautiful caves formed over millions of years that you can take tours of. Spend a few hours taking in these beautiful natural wonders and seeing some of the formations and underground pools.
Saint Lucia Carnival
Saint Lucia Carnival Dates: July 10, 2024 - July 17, 2024
Home to some of the most beautiful mountains and beaches in the Caribbean, Saint Lucia has the perfect backdrop for an unforgettable carnival experience. Saint Lucia Carnival didn’t take flight until the late 1940s but has grown into a favorite for both novice and seasoned masqueraders. Formerly held in February, this carnival now kicks off in July which allows it not to compete with the highly revered Trinidadian carnival that also happens at that time. Saint Lucia’s Carnival has grown in popularity over the years because of the lively music, delicious food, and turned-up fetes.
One of the highlights is the Parade of the Bands, where masqueraders adorned in elaborate costumes dance through the streets to the rhythms of soca, calypso, and steelpan music. The best way to prepare for the Saint Lucia Carnival is to stay hydrated and well-fed so that you can thoroughly enjoy the plethora of events and parties happening from early morning to nightfall.
Other things to do:The Pitons, Gros Piton and Petit Piton are a UNESCO World Heritage Site and one of the main attractions in Saint Lucia. Take a hike of Gros Piton or just marvel at its natural beauty. If you're there on a Friday night, stop by the weekly Gros Islet Street Party, which is filled with music, drinks, and local food.
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Featured image courtesy of Grenada Tourism Authority