Wednesday Q & A: How Do I Rebuild My Credit?

When I retire, should I open a medical savings account, or should I have one before that?
Health Savings Accounts & Medical Savings Accounts (essentially the same thing, with MSAs being restricted to self-employed persons or employees of small businesses) are great. As far as when you should start contributing, the same holds true here as it does for other retirement accounts – the sooner the better! If you’re eligible to contribute to such an account, these plans can be a great way to reduce your overall medical costs in retirement.

I have a pension that will pay me a monthly benefit, but it will reduce my social security monthly benefit. What do I do?
Most of the time we come across this scenario, Social Security is reduced because the work that generated the pension didn’t pay into Social Security while you were at that job – while nobody likes a smaller check from Social Security, you’re likely still receiving more money month-to-month than from Social Security alone. To understand your individual situation, it’s best to schedule a visit with us so we can review all of your options and help you make an informed decision.

How do I rebuild my credit?
The answer to this question is much easier said than done: pay down your outstanding balances, and pay off your month-to-month charges at the end of every billing cycle. As far as debt management is concerned, many of our clients have had success using programs to analyze your outstanding balances and figure out the most efficient method of knocking them down.

Once your debts are paid off, it becomes a balancing act of maintaining on-time payments and being sure that you use some (but not too much) of your available credit every month. One point of caution here: don’t fall victim to those “credit repair services” that promise to remove bad items from your credit report in exchange for a fee. Those companies often promise more than they can deliver, and the money would be better-spent reducing your outstanding balances.

We’re Here to Help

Have questions about this week’s content, or need help with your financial plan?  We’re here to help!  Simply call our office at (504) 832-9200 to schedule a complimentary Guided Planning System® consultation today or find “Schedule A Visit” at the top of this page!