Consumer questions: Credit scores, cell phones

Pay off credit debt?

Question: From Arlene in Oakland: "I wanted to ask Michael Finney whether credit card debt should be paid down or the money should be used in a different way in the event that you have a lot of credit debt as opposed to using it for savings or some other enterprise?"

Answer: It's a question that a lot of people are trying to balance right now. The most important thing you can do is get rid of credit card debt. Our savings accounts are as low as .25 percent. If you really shop around, you'll barely hit four percent. Now you take a look at your credit card, and other than the teaser rates – the rates you get at the very beginning, you're looking at rates around 8.9 percent up to 14 percent. And if you have bad credit, you'll be going as high as 20 percent, so you're much better off starting to pay those down. Another reason to start paying them is it gets your mind where it needs to be to start living your life within your means. If you can get them down to zero, you're not going to want to start overspending again.

Why won't my cell phone work?

Question: From Robert in Berkeley: "We have put a man on the moon, we've got robots on Mars sticking their arms out grabbing samples and fixing stuff, we have all this technology, we've got shuttles, we got planes, so why can't my cell phone work? Why can't my cell phone hold a conversation for more than one minute?"

Answer: The best way to protect yourself when it comes to your cell phone being useful is before you sign up for a contract, check to see how long they're going to give you with that phone and that service, before they lock you in. Most companies will give you between 14 days and one month to figure out if your phone works where you need it to. If it doesn't, you should return the phone.

Boost your credit score

Question 3: From Lindsay in San Francisco: "I am starting to look at buying houses. Is there a way that I can boost my credit score?"

Answer: That is the right question right now because it's the perfect time to buy a house because the market's down so much. And getting your credit score down will save you tens of thousands of dollars over the length of the loan. First of all, make sure your score is accurate. The way to make sure your credit report is accurate is by going to You're allowed to get one free report from every reporting agency. Secondly, start paying your bills on time. If you're late, it wrecks your score. Also, your debt-ratio is important. So if you have a card with a $5,000 limit and you're at $4,999.99, your credit is tanking. So you want to get those below 50 percent. And if you really want to do something about it, go to and pay $14.95 to get your credit score.

For more of Michael Finney's consumer stories and advice, visit 7 On Your Side.

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