It’s tempting to think of your credit score as something that is only important when you’re young and trying to get established.
After all, most big purchases happen relatively early in life. This could include buying a house, upgrading your car, starting a business, and managing the financial demands of a young family and/or aging parents.
Or maybe you’re still in the first half of your life and wondering if you can retire earlier than planned.
Regardless of your age, the truth is that your credit score still matters in retirement. Here are some reasons why you should never ignore your credit score in retirement.
Applying for new credit cards
You might have fewer expenses in retirement, but that doesn’t mean that have to stop using credit cards.
In fact, you probably have more time to optimize credit card rewards and earn points. As a result, you might find yourself applying for a new credit card or two.
It’s a good idea to maintain your credit score so you always have access to new credit cards or increased credit limits regardless of why you need them.
Utility companies check your score
Utility companies like cell phone and Internet providers probably aren’t the first businesses that come to mind when you think of your credit score. But these companies check your score before providing you with service.
If your score is too low, you might be charged higher rates or denied service altogether. Retirement status doesn’t impact your need for these services, so it’s a good idea to keep your credit score in good standing.
Life is filled with unexpected financial surprises. Despite your best efforts, it can be difficult to always be prepared.
You could find yourself in a situation where you need access to additional money through a credit card, home equity line of credit, or personal loan.
Once you’re retired, you probably won’t have the same kind of income as you did before. That's why it’s especially important to maintain your credit score in case you need a loan.
If you do need to add more debt to your finances, make sure you plan to pay off your debt.
Save money on insurance
Utility companies aren’t the only ones checking your credit score before offering you a deal. Insurance companies review your credit score as well.
Much like jury duty and taxes, insurance will always be a part of life and retirement doesn’t change that. Make sure you get the best deal on your insurance by maintaining your credit score throughout your working years and beyond.
Retirement is also a good time to review your insurance needs. You might be driving less (or not at all) and be able to save money on car insurance.
Your credit score is only one part of your financial picture, but if you take good care of your score, it can help you secure some of the best deals.
Renting is easier
If you’re a long-term renter, it’s especially important to maintain your credit score in retirement. Leasing companies and private landlords typically pull your credit history — including your credit score — before approving your rental application.
If your credit score is too low, your rental application could be denied or you might be required to pay a higher deposit in order to move in.
To avoid the extra hassle and expense, make sure to monitor your score throughout retirement. Even if you’re not renting, it’s impossible to know what the future holds and it’s always better to be prepared.
Keep your options open
You might not know what the future has in store when you first enter retirement. You may live for many years yet and could be in for some surprises. That’s actually the biggest reason you shouldn’t ignore your credit score.
You may want to buy a new home, downsize your vehicle, or make your home more accessible — and you may need a loan to do it.
By maintaining your credit score in retirement, you’re setting yourself up for a positive experience with endless possibilities.
Life doesn’t end in retirement, so avoid throwing away your money by maintaining your credit score.
In fact, according to AARP, Americans who are 50 and older have actually increased their travel budget over the last year and are ready to explore.
Your credit score is a financial tool that you want to be able to keep using so it can help you evolve throughout this new chapter.