debt to income ratio, credit health, credit score, good credit score, bad credit score, improve credit score, personal finance, financial health, healthy credit score, credit worthiness, how credit score works, how to repair credit, what is a good credit score number, Matt Giovanisci, RoastyCoffee, I Will Teach You To Be Rich, The Simple Dollar, Trent Hamm, Ramit Sethi Matt Giovanisci at a computer Matt Giovanisci at a computer Matt Giovanisci at a computer Matt Giovanisci at a computer
Your Money

Credit & Debt

Rebuilding Credit Health: From Rock Bottom to Over 800

A Decade After a College Spending Spree, the Damage is Undone

Once upon a time, a college student opened his first shiny credit card.

While it carried a modest $500 limit, it gave the then-18-year-old a false sense of financial freedom. “I thought I had, like, a free $500 gift card … to buy anything I wanted," says Matt Giovanisci (pictured above), a web developer and creator of the blog Roasty Coffee, who is now 31 and wiser. “I immediately activated it and just started buying dumb stuff."

Within a couple weeks he had maxed out the card and, worse, the credit rookie didn't realize he needed to make timely payments. “I must have waited six months before I started even putting the minimum towards [the card]," he says.

To say his credit suffered is an understatement. When Giovanisci checked his score a few years later, it registered at a sad 590 (out of 850). Buying a car and qualifying for more credit cards proved quite the challenge. His father had to co-sign his car loan, and he could only secure additional credit at very high interest rates.

The bad credit behavior ensued. By age 27, Giovanisci had racked up some $10,000 in credit card debt and was barely making the minimum payments.

But as with many money makeover stories, his “aha" moment arrived once he truly realized – and become motivated by – his professional goals. Giovanisci wanted to start his own business, and a subpar credit score and thousands of dollars in debt wasn't going to help.

“It wasn't a conscious effort to simply fix my credit," he says. “I prioritized getting my entire personal finances in order. I knew that if I was going to start my own business and be my own boss, I could not afford to be bad with money."

A few years after that epiphany, Giovanisci's credit score is an impressive 801 out of 850.

How He Did It

First, he asked his mother to help him learn how to handle money. She put him on a strict budget, and he was able to reduce his expenses.

He also started learning. He says books like Ramit Sethi's New York Times bestseller “I Will Teach You To Be Rich" and “The Simple Dollar" by Trent Hamm taught him how to manage and automate his financial life. “I was paying everything on time, because I had put these systems in place."

Next, he downsized his life and lifestyle. “I was so determined to start this business that I didn't care about material things anymore," he says. He rented out his house and moved in with his brother. He sold his car and bought a cheaper set of wheels. “I just went backwards. My goal was to lower my monthly expenses as low as I could possibly go without like feeling any sort of discomfort." He managed to cut his monthly expenses from $4,500 to $1,500.

Once he began making payments on time and reducing his debt, he asked his credit card companies for higher limits. That helped lower his debt-to-credit ratio; the lower your ratio, the better it is for your score.

He also boosted his income through freelance web design, graphic design and helping others produce videos for their sites. That extra work helped him pay down his $10,000 credit card debt in just six short months.

With better credit scores, Giovanisci has access to premium credit cards that offer rewards, along with resources to help grow his business and start new projects.

What's the best part of it for him today? “My credit score impresses my mom."

Ready to pay more attention to your own finances? Find out how to get tools that can help track your credit health from Chase Slate®.

For more tips and resources on mastering your finances, visit chase.com/financialfitness.

The opinions stated are those of the author and are not necessarily the opinions of Chase.

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