Getting Closer to Buying a Home

So you’ve established credit for yourself and you’ve started using it. Terrific! Well, how is it going? Any challenges?

Take a moment to write them down—along with affirmations to help you overcome them— on the Affirmations to Build Good Credit Worksheet>>

Reality check. Alicia needs your help.

Alicia is a single mom. Her mother, who works nights, watches her children during the day while Alicia works as a bank clerk. Alicia’s car broke down and the cost of fixing it exceeds her monthly spending limit. She does not have an emergency fund. Alicia needs her car to get to work on time, and then back to her house by the time her mother leaves for work. She can take the bus for a couple days, but would get home late and have to leave her children alone for a while.

Alicia is in the process of improving her credit. She has a budget, sticks to it, and knows the importance of paying off her credit card bill every month.

What action would you recommend Alicia take?

Here are some possible answers. Can you come up with any others?

•	Charge the expense to fix her car. Alicia cannot risk getting home from work late and leaving her children alone. If her children were to hurt themselves while alone, Alicia could not afford additional medical expenses.
•	Reduce other monthly expenses to allow for the increased credit card expense.
•	Pay off the car expense in three months (three payments).
•	Pay the credit card bill on time, every month.
•	Save a small amount every month to build an emergency fund. It is best to pay for unexpected expenses from money saved.
Source: Girl! Get Your Credit Straight by Glinda Bridgforth

If you don’t have an account at a financial institution, get with a friend and visit a few in your neighborhood. Print out copies of the Choosing a Financial Institution Worksheet and carry it with you as a guide. Which institution offers the best overall deal? What will it take to begin using their services?