5 ways exercise is good for your health and credit
By Brian Wu
April 8, 2016
Exercise is good for your health and your credit, fitness and financial coaches say. Making sure you and your plastic get a regular workout builds muscle and your credit score.
So just as you hit the trails, go on long walks with your dog or sign up for a spin class to tone your body, here are five tips from money and exercise gurus to get your credit in shape:
1. Build a sound body and credit history.
Using credit cards in a responsible manner improves your credit score, which is key to getting a home loan, buying a car and renting an apartment.
Part of the credit scoring formula is using your card on a regular basis — just as those trips to the gym or runs around the neighborhood keep you fit. This credit exercise sends a message to lenders that you can handle credit.
But don’t overdo it — on charges or gym time. “Only make purchases that can be covered by money you already have in your checking account,” says Nick True, a money expert at truetightwad.com. “By charging to the credit card only what you can cover in your checking account, you guarantee that you will be able to pay it off at the end of the month.”
“By charging to the credit card only what you can cover in your checking account, you guarantee that you will be able to pay it off at the end of the month.”
— Nick True,
Slow and steady is best. Good credit is built over time, just as regular runs build up strength and endurance. “It is important with the young athlete to do a fair amount of mileage at low intensity,” says world renowned marathon coach Renato Canova. The takeaway: Take it slow. Don’t charge carelessly and run up your credit card.
2. Getting started: Weigh in, then track your fitness and credit progress.
It all starts with knowing where you stand. For fitness, that means stepping on a scale. For credit, you need to know your credit score, which you can get for free at AnnualCreditReport.com.
Then track your progress to your goal. Just as there are all sorts of fitness monitors (Fitbit, Jawbone, etc.), there are credit score trackers to help you keep tabs on your improvement. (Or to track any backsliding, if you didn’t make it to the gym or missed a card payment.) Credit tools now often come as a perk with some credit cards.
And just as your trainer monitors your body mass index, your credit utilization ratio — a key factor in calculating your credit score — serves a similar function. You need to keep a healthy balance of credit — using less than 30 percent of your credit limit — credit experts say.
With credit utilization, even lower is better. “The ideal credit utilization percentage is under 10 percent,” says Debbi King, author of “The ABC’s of Personal Finance.” “Anything below 30 percent will help you stay on the positive side. Anything above 30 percent will begin to take you over to the dark side.”
3. Find the card and gym that works best for you.
Keep your eye on the costs and perks associated with your credit card — just as you do with any health club membership. Maybe you can get a lower interest rate or a late payment waived? Call and ask. Or consider switching cards, just as you might change gyms.
Your health club’s amenities can be likened to your card’s rewards and perks. Maybe you like having the on-site day care, pool and Zumba classes because they fit your lifestyle. If you’re a world traveler, a card that helps you score miles, points, no foreign transaction fees and access to airport lounges may be worth the annual fee.
Or maybe your gym — and credit card — style is no-frills. Low interest cards, cash back and no annual fee cards may be just your ticket.
“If your credit card offers major cash back rewards at grocery stores and gas stations, take advantage of these purchases.”
— Caleb McElveen,
“If your credit card offers major cash back rewards at grocery stores and gas stations, take advantage of these purchases.” says Caleb McElveen, content manager for the Saving Thousands radio network. “You must identify the best way you can utilize using this credit card and what you will get in return.”
4. Make exercise and paying bills on time a habit.
Make getting in a workout and paying bills on time a part of your routine. To do this, use online calendar and bill payment reminders to keep you on track.
Your payment history is the biggest factors (35 percent) of your FICO score, so paying your card on time builds good credit. Being late or missing payments can ding the good credit score you’ve worked to build.
“A great tip is to pay your balance three-to-five days before the statement date.” says King.
Also make a habit of checking your credit card statements for any sign of fraud. If you spot something suspicious, call your issuer.
5. Keep your eye on the prize — be it losing weight or growing a high credit score.
Credit card use and staying in shape are both goal-oriented endeavors, with a specific end-game in mind. For example, those trips to the gym can help you lose 20 pounds, and keep it off. For card users, the ultimate goal is a high credit score and great credit history, which can be achieved with a perfect payment history and low or no balances.
For some cardholders, the ultimate goal is to keep their balances at zero. That’s a great goal, and with proper planning and credit card use, it’s attainable, says Matthew Coan, founder of Casavvy.com.
“Use your credit card to spend only money that you have and you won’t run into the problem of having a balance left over at the end of the month that you will have to pay interest on,” he says.
Whether you’re building credit or muscle, it takes time and commitment. Get started, track your progress and stay focused on your goals, money and fitness experts say. And be patient. It takes time to get your body in shape for summer and a credit score of 700 or more.