How this power couple is taking the financial World by storm: Advice on credit repair, investing, and financial literacy
I am totally responsible until my bills are all paid. After that it seems that money just flows through my hands. As a mother, I am often wasting money on or for my son and attributing it to the greater good of "motherhood". Truth is, that is just an excuse I use to mask how hard it is for me to budget. I seem to only make enough to meet a goal, pay some bills, and that's it. However, we aren't getting any older. In order to secure the future of our children, we have to learn how to make our money make us money. Marvin and Gloria Smith are financial strategists, authors, entrepreneurs, and investment experts. This power couple has taken the financial industry by storm and is always pushing financial literacy within their community. Clearly, even I need help in their area of expertise. Check out our interview with them below where they give us tips on investing, credit repair, financial literacy, and more:
What advice would you give to someone who is interested in investing? We would first recommend buying stock. What are you already buying? What are you already wearing? Buy one or two stocks in companies that you already invest in from a consumer perspective. You can also go on sites such as Charles Schwab and call them for assistance in investing online, buying products, brokerage accounts, etc. The time to start is now. In 1986, Nike stock was worth $1 and now it is worth $86. Don’t let the price of the stock scare you, buy one share if you have too. For example, we use Dropbox, Nike, Roku, etc. so we did our research and brought stock in all of them. Secondly, invest into real estate. Buy something that is within your means and/or buy a property that is undervalued. First-time home buyer programs consider you a “first-time homebuyer” every three years. Start off with a small home, i.e. investment, and then repeat the process again after three years. CLICK HERE for more information about being a first-time home buyer. Stay current. We watch CNBC a lot, every day from 6:30 am to 4:00 pm we try to catch a stock show and just listen. Watching the shows will get you familiar with the terms, the businesses, whose getting fired from where, etc.
Why is financial literacy important and how can someone with no experience begin to educate themselves? Nowadays it is a lack of knowledge as to why we are not successful in life. Knowing the difference between a 6 and 25 percent interest rate can save you a lot of money. A lot of young people are under the misconception that “cash is King”. In all actuality “credit is King”. You must understand your credit to maintain and/or repair it. The first step is to go to annualcreditreport.com and get all three of your reports. Every year you can get them all for free from all the bureaus and it is very detailed. The main thing to know is what is affecting your credit, mistakes that need to get fixed, and if you do not have credit how to build credit. If you want help understanding these things we offer free consultations to everyone. (CLICK HERE to schedule a consultation). This consists of a 15-30-minute call where we go over your credit, where you want to be, and what you need to achieve to increase your credit score.
What’s considered a healthy credit score and what are some easy ways to maintain good credit? A decent score is 680 and anything above your getting great interest rates on houses and cars. In the credit world, a late payment is the worst thing that can go on your credit. It drops your score anywhere from 75-100 points just by missing one payment. So pay your bills on time, 2-3 days before the due date if possible. Also, plan your major purchases about 2-3 months out and keep your credit cards below 30 percent. A lot of people make impulsive decisions and that leads to missed payments, etc.
How can Mother’s start their kids off with credit at an early age? Add your kids as authorized users to your credit cards. We started our kids off at 14 years old, the sooner the better. All our children have a 700+ credit score because we simply added them to our line of credit. Remember that if your child has good credit if something happens than their parent can become an authorized user and improve their credit too.
How do you build business credit? Building your business credit is easier once you get incorporated and start your limited liability company, corporation, etc. legally. You’ll get a bunch of catalogs in the mail once you start your business. Set up accounts with all the vendors that you can to start that open line. Get a DUNS number from Dun & Bradstreet, this company tracks business credit (CLICK HERE). Always fill out what’s necessary on the business application, i.e. if your social security number isn’t required don’t put it. That’s how you truly separate your business from personal credit.
What are some common misconceptions that you guys hear often about building credit? Cash is not king, especially for business owners. Always get more than what you need, when you need it regarding credit. People think that having too much credit will have a negative impact on your score. That is not true. It is easier to find money when you’re not looking for it than when you are. For an emergency, it’s better to use a Visa versus borrowing money form a person. Remember that high limits don’t affect your credit score, your behavior does. Getting multiple credit inquiries at one time does affect your credit. For example, if you want to purchase a car go to the bank first. Get an approval and then go to the dealership. This will give you lower interest rate and less inquiries.
If someone already has bad credit what are some steps they can take in repairing it? First step, pull your credit report. You can go to our website dkrgroupfinancial.com and get a free credit analysis from us. Understand your accounts and what status they are in. Is it in collections? Do you have the money to pay it off now? Identify negative notes and reach out to the accounts to see if you can make a payment arrangement. Some creditors will even lower the amount owed and report it as paid so that it comes off your credit.
It’s common currently for people who ruin their credit or find themselves in the hole to just file for bankruptcy. Does this always “wipe the slate” clean? No, it does not. People think that once you file bankruptcy your debt is gone. That is not true. It is true that you no longer owe it but it’s still on your credit.
What advice would you give to someone who wants to become a financial strategist? We have a class in which we teach people how to go into business as a financial consultant. It is an in-person three day course. Last class we had six testimonials from the people we trained where they told their story and how they were already making 10-25k a month. We also have a boot camp coming up for anyone that wants to understand their credit, how to complete your own disputes, and show you how to transition into becoming a credit repair specialist. The LIVE boot camp is only in Atlanta but we are in the process of setting it up via a Webinar (CLICK HERE).
What do you guys consider financial security and what are some general financial goals everyone should have? Go with the golden rule, save 10 percent of whatever your making for an emergency fund. It is very important to not live above your means and keep those credit card bills under 35 percent. Think about your spending habits. Try to have at least 3 months of reserve of your bills saved up as that emergency fund. See where you stand with your credit and see where you need to go to make those big purchases… build your credit or become an authorized user to increase points on your score. Just plan. So many times, we make decision on impulse instead of necessity so plan it out.