Here’s a recent unexpected question I had. What happens to my credit score in retirement, and do I need it?
The simple act of retiring does not affect your credit score. That’s good! Being employed is not part of the calculation.
You do want a great credit score in three possible scenarios that I’m aware of.
First, what if you need or want to change where you live? Sure, you may now be thinking, “Nope, this is where I will retire and be living when I die.” That may not actually be the case. Maybe the kids will move to another state. Maybe a different climate will become necessary. Or maybe it’s not changing where you live but buying that second home. That home purchase becomes a lot easier with a great credit score.
Second, if you are very disciplined, getting a credit card or two with rewards built in can help fund some things in retirement. Maybe it gives you airline miles, cash back, or even discounts on hotels. The key is to pay off anything on your card quickly.
Finally, what if you want to co-sign a loan for a kid or grandkid as they try to build out their credit? Your credit will be checked, and a good credit score will make it easier for you to help as a co-signer.
So, to keep your credit looking great, make any debt payments on time. Also, maintain clean lines of credit. Of course, most of you do this well and have great credit scores.
September is here… I hope the summer has been good to each of you.
