Identification

• From a purely mathematical perspective, knowing your credit history is likely to save you money on loans, because you will know to rebuild your score before applying for an account. The actual cost of bad credit depends in part on how much debt you use and which services you buy, but Liz Weston of MSN Money Central suggests that the average person with bad credit pays over $200,000 more just for loans than someone with a high score; good credit is usually anything above 680.
  
  

Other Considerations

• In the U.S., the trend in 2011 is for more companies to run credit checks, because how you handle debt says a lot about your character. Rental car companies, for example, won't rent a car without a credit card unless the customer has good credit, because people with bad credit tend to make risky decisions and may not be able to pay off damages to the vehicle. Utility companies and cell phone providers use credit checks to determine if they need a deposit from you or if you qualify for certain services.
  
  

Cost

• The federal government requires the national credit bureaus to furnish one credit report each year for every citizen. Also, you can check your report for errors. If the bureaus report false data, you should file a dispute, because your credit report may be the only thing that creditors know about you. Thus you might have a tarnished reputation with some companies, which could hurt you if you ever need emergency funds.
  
  

Tip

• Go to the Annual Credit Report website if you have not already. It is the only place to get a completely free credit history. You might also want to purchase your FICO score, because most lenders use the FICO model when setting rates. If you just want to know your credit report tier, you can use a free FICO score estimation tool. Also, work to clean up negatives on your report. The credit bureau report will identify bad items or threats to your score, such as a high level of debt.