Have I Been Blacklisted?

How to check if you have been blacklisted.

In South Africa, blacklisting was a term once used to refer to irresponsible financial behaviours, and negative information on a person's credit report. It was widely used during a time when only negative data would be collected by agencies and credit bureaus. The record would be stored in files and circulated among businesses, eventually ending up in what we know today as credit reports.

Having a great credit score can mean the world for someone without much financial backing by their own means, and it may even help change your life for the better in many ways.

Starting your financial journey.

No one has more of a stake in your financial future more than you do. It’s important to have a financial plan for yourself. Have a sound financial plan, and you’ll be able to save money, treat yourself to the things you really want, and achieve long-term goals, like saving for your children's education or your retirement.

Everyone wants to be wealthy, so they set out on the adventure to become exactly that. To get on a path to financial fortune.

When someone decides that they want to start saving for the future or secure their current financial situation, they usually take part in investing either their own cash or by using outside investments such as stocks, bonds and mutual funds.

Here are a few tips on starting your financial journey:

1. Set goals:

It is important when setting goals and objectives to first set goals that are important to you. Each goal is unique, and the most important thing is to make sure your goals fit into a plan that allows you to reach those dreams. To help simplify things, there are a variety of ways people choose to divide their categories; however, many prefer four: retirement goals, saving goals and protecting their assets against risk, as well as estate planning goals.

2. Prepare a budget:

Once you have brainstormed your goals and objectives, it's vital to commit them to paper. This is so that you can begin budgeting properly throughout the year. Budgeting helps you see where your money is being spent and helps you prioritise what is most important. By doing this, you will know how much goes to what when it comes to decisions on how much money will be allocated on each goal.

3. Understand and protect your risk:

Once you've understood your goals. It is time to understand them in terms of the nature of the risks that could potentially occur. You need to consider what would happen to your bankroll in the event of unforeseen circumstances like death, permanent disability or chronic ill-health. You’ll need to map out and identify potential solutions around how you can best protect yourself against these risks.

There are different insurance companies that offer a variety of options, these options can get overwhelming due to the sheer amount of info. You might find it difficult understanding what insurance will be able to help.

This is where an experienced financial planner who has an understanding of your income and capital sources as well as risk tolerance comes into play.

4. Manage your debt:

It's important to understand the difference between 'good debt' and 'bad debt' before taking out any loans. Good debt, such as home loans or student loans for example, are a form of debt one takes to pay for large ticket items which one might not otherwise be able to afford.

5. Create an emergency fund:

The next crucial step, one which many people take for granted, is to create an emergency fund. We all hope to avoid getting into a situation where we need it, no matter how financially responsible you may be, there will come a time when you'll need some extra money.

There will always be unexpected expenses like repairs to the car or having to take your dog to the vet. An emergency fund works just like a savings account and is started with cash - not debt. This ensures that you’re able to protect yourself against unexpected costs while preserving your existing assets and keeping your head above water in case something goes wrong early on.

6. Plan for retirement:

There is no better gift to give to your future self than a retirement fund. You will thank yourself if you start investing early on in your career. Given a longer investment timeline, the wealth compounds and grows over time. You may not have any idea at what age you wish to retire, or whether you ever envisage becoming financially independent. Long-term investment can bring you to a point of financial freedom which should be your ultimate goal.

Worried about being blacklisted?

Luckily, you have very little to worry about. “Blacklist" is an ancient term, a category from when credit bureaus only kept negative information. Not everyone is aware of this, that is why it is only natural that people who have little to no information about this will be worried. Nowadays, having responsible borrowing and repayment practises is one way you can make yourself feel confident about your credit score.

How to ensure a good credit record?

Maintaining a good credit record is easy, just as long as you are financially sound. It is important to remember that your credit rating will change based on how well you manage your finances. For example, if you’re a responsible consumer who pays off their bills on time, it shows a positive financial history and demonstrates that one can be financially reliable when given the chance. Ways in which you can ensure a good credit rating include:

1. You need to make any credit repayments you make on time and in full each month.
2. Keep your debt less than 20% of your annual income.
3. To build a stronger credit score, it's good to have taken out some debt and paid that debt back.
4. Checking your credit throughout the year can also be a relief. Make sure it’s valid and is double checked with professionals. This also helps make sure that you are on track.
5. If you are married, credit checks will be done by both you and your partner’s respective institutions, so make sure to get a credit report for both of you.
6. Communicate with your creditors. This is often done through credit counselling companies, who act as an intermediary between the creditor and debtor to come up with a fair repayment plan.

Your credit record is a valuable tool, not just for borrowing money, but for proving that you are a conscientious and reliable citizen. Your credit report will affect many aspects of your future. From employment prospects, to loans, renting a home, or more, your credit report counts.

Establishing a positive history on your credit report with prompt loan repayments can help you avoid any pitfalls when applying for things later in life, so it’s important to establish good habits right now. If you want to learn more about being blacklisted, feel free to contact Credit Health for more information.