Have you ever wanted to be perfect?

One of the characteristics that I find very attractive in people is the desire to do their best. I find that a lot of people are satisfied simply being better than the person working beside of them, instead of trying to reach their true potential. I think a lot of things go into creating an attitude of “good enough”. Unfortunately, it seems the goal to always do your best has gone by the wayside.

We even see it in the political arena. Recently when the news was heavy with discussions about the number of vacations that President Obama has taken the push back from the other side of the aisle was to remind us of the number of days President Bush spent at his ranch. What has happened to the desire to strive for perfection?

I came across an article over at CNN Money where one couple has decided to reach perfection. The perfect credit score that is. Apparently, the perfect credit score is 850.

“Your credit score tells a lot about you,” Peplinski explains. “A high score means you’re responsible and in control of your life. You’re trustworthy.”

I agree that the credit score does give a pretty solid picture of your financial life, however, the depths that some people are willing to go to just to achieve a perfect credit score is just a little bit weird. There are some good things that come from having a high credit score and for that reason alone the couple in the article were willing to take out a loan to purchase a car even though they had the means to pay cash for it.

During our recent refinance, we were able to lower our 6.25% rate to 4.375% without having to get an appraisal. According to our mortgage broker, our 800+ credit score had a lot to do with our deal. However, is taking on extra debt just to get a few more points added to the credit score really worth it?

What is a credit score?

Even though the actual formula is somewhat ‘magical’, there are several things that go into calculating your credit score. According to FICO, the five things that are used to come up with your score are:

1. your payment history
2. the amount you owe on credit lines and loans
3. the length of your credit history
4. how much new credit you’ve applied for
5. the types of accounts you’ve had

According to Dave Ramsey, the FICO score can also be called the “I love debt” score. The reason that Dave says this is because the only way to have a credit score is to stay in debt. When you look at the five things that go into calculating the credit score, it is pretty obvious that he is right. Dave tells a story that when he tried to find out what his credit score was, he received a letter that basically said he didn’t have a credit score. The reason? He doesn’t have any debt, and hasn’t had debt for over 20 years.

Right now we still have our mortgage and that is the only debt we have. Our payment history is excellent and unfortunately we have a debt history of over 21 years, but we are working to end that streak. The primary goal of our recent refinance was to knock six years off the length of the mortgage.

Free credit score?

If you haven’t checked your credit score recently, don’t be too concerned, however you should check your credit report at least every 12 months. You can get a free credit report simply by logging onto www.freecreditreport.com. The most important reason to review your credit report is to make sure there aren’t any errors being reported against you.

Getting a free credit score is a little different. There are a lot of sites out there that offer a free credit score, but there is always a catch. Basically, if you sign up for a credit monitoring service you will get a free copy of your credit score, but the monitoring service is expensive. You don’t need to pay someone else to monitor your credit report for you, and you definitely don’t need to pay them close to $100 a year to monitor it.

photo credit: TheTruthAbout…