Most people work hard to maintain good credit when they’re younger; after all, it’s essential for getting a loan, purchasing a car or buying a new home. And it’s true — the impact of your credit score is felt more heavily during those early years.
However, building and maintaining credit doesn’t disappear once your retire. In fact, your credit score can have a big impact when you’re in your 60s or 70s — for better or worse.
Here are six reasons why maintaining good credit is important as we get older:
1. Co-Signing a Loan
Want to co-sign for someone? Even if you don’t plan to loan money to your adult children, they may need your help if they want to get a loan. Being able to co-sign for someone requires you to keep a high credit score.
2. Starting a Business
Now that people are living better and longer, many retirees are starting second careers. If you want to apply for a business loan or credit card, or are planning on renting office space, you will need a good credit score.
3. Divorce
A divorce almost always requires that you start over. Whether you have to buy a new house or rent an apartment, you’ll need a good credit score.
4. Travel
Traveling abroad often requires having a credit card, especially if you want to rent a car or book a hotel room. Many of these companies will not let you use a debit card. If you want a good credit card that works abroad and has zero foreign transaction fees, you’ll need to have excellent credit.
5. Insurance
Do you carry homeowner’s or auto insurance? Oftentimes insurance companies will partially base their rates on your credit score.
6. Assisted Living
Some assisted living facilities will check your credit when you put in an application. A bad score may affect your ability to get into a reputable facility.
Think of it this way: having a good credit score is like being in good physical shape. You may not have to lift a couch on a regular basis, but it helps to have the ability when you need it. Even if you don’t think you’ll need a good credit score, it’s wise to monitor yours on a regular basis. You never know when it will suddenly become important.
