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Why You Need to Know What is On Your Credit Report

Kiara Webster

Woman checking her credit score.

Do you know what your credit score is right now? For many of us the answer is “no.” It’s all too easy to neglect your credit score until you need a loan, or want to buy a home, or get a new job. But your credit score has a bigger impact on your financial life than you may realize. Here are five important reasons why you need to know what is on your credit report.

1. Protect Yourself from Identity Theft

The main reason you need to know what’s on your credit report is that this knowledge can help protect you from identity theft. The faster you’re able to catch an identity thief the less damage will be done to your credit and finances. It can take years to recover from just one bad credit decision, and identity theft and can rapidly harm your future finances. This is why it’s so important to keep a close watch on your credit information.

Checking your credit report regularly means you know where you stand and what’s happening with your financial information at all times. Ignoring your credit information for too long can negatively impact your entire life -- not just your money. No matter if you have good credit or poor credit, being in the know will help you develop a plan of action to improve your finances and protect yourself for the future.

2. Ensure Your Information is Accurate

Your credit report is a reflection of your entire financial life from the past, present, and future. Knowing what’s on your credit report means that the information will be correct and accurately represent where you’re at in life. Make sure that any name or address changes are current and that your credit score is where you expect it to be.

If your credit score is lower or higher than expected, you’ll be able to understand why and prepare for the impact it may deliver. You can also empower yourself with knowledge and be able to continue positive financial habits and eliminate the negative ones.

3. Eliminate Surprises When Applying for a Loan

Being in the know with your credit report eliminates any surprises that might come up when applying for a loan. You won’t be surprised by the outcome of credit applications or fear being blindsided by your loan application being denied. Knowing where your credit stands means that you’re confidently prepared for any possible outcome and can easily deal with it.

4. Aids You in Getting a Better Job

Not every job requires a credit check, but in the event that an employer does want to see your credit report, you don’t have to worry about the unknowns. A low credit score can be an indicator of a problem employee in the eyes of the employer. Knowing your credit information ahead of time means you can prepare for any questions, or feel confident knowing that your credit is healthy.

Your credit could also have an impact on how much you get paid, or if you qualify for a raise in the future. In addition, if your application is being compared to someone else with better credit, you’ll want to have the answers ready that can tip the result in your favor.

5. Qualify for the Best Credit Offers

Most credit cards come with high interest rates, so instead of trying to score a lower interest rate, use your knowledge to your advantage. Use your credit to qualify for credit card perks and other rewards that might not otherwise be available. You can also use your past payment history to have any interest charges or late fees waived.

Some credit card rewards can be very lucrative and offer hundreds of dollars in cash back or upgraded access to premium perks at no cost. As your credit improves in the future, you can negotiate 0% interest deals or credit line increases. But all of this depends on what’s in your credit report and how you can use it to your benefit.

6. Check Your Credit Report for Free

You can monitor your credit score regularly for free with services like or These financial services allow you to view your TransUnion and Experian credit scores while staying updated on changes with your credit report. And it can all be done at no cost to you!

In addition, your current bank or other financial institution may offer credit monitoring as an added bonus. Many credit cards offered by Discover, Chase, Bank of America, and American Express offer FICO scores for free as an added perk for being a customer.

Finally, if you want more in-depth credit monitoring, you can pull a detailed credit report for free once-a-year by going to Simply input your personal information and then save your report in a safe place.

These are just some of the reasons why you need to know what is on your credit report. Not doing so on a regular basis can cost you money and possibly a lot of unnecessary stress. Don’t let your credit report negatively impact your financial life. Take action and check your credit today.

First published , last updated



Kiara Webster

Kiara Webster is a financial writer and founder of Careful Cents, a blog and community aimed at helping freelancers overcome financial mountains. Her mission is to focus on building client-based businesses through meaningful relationships. She's been featured and published in Glamour Magazine, The Huffington Post, Inc and many other media outlets. Learn more about her and connect with her in real time on Twitter @carefulcents.

Learn more about Kiara Webster

Editorial Note: Any opinions, analyses, reviews or recommendations expressed in this article are those of the author's alone, and have not been reviewed, approved or otherwise endorsed by any card issuer.

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