Would You Rather Be Rich or Right?
March 10th, 2008
By The XBanker
Would you rather be right than rich?
It’s a question my friend and colleague Phil Laut asks in his books Wealth Without a Job and Money is My Friend. I love Phil’s straightforward advice for entrepreneurs, and I agree with him. This particular question is one that comes up time and again when I am answering credit questions.
Here is the scenario: Your cell phone company, or medical insurance provider, or some other company has screwed up your bill. You’re ticked off and not going to pay it. So you tell them to take a hike.
Or maybe you move and you don’t get a bill for a couple of months. When you finally do, it’s been turned over to collections (and the amount is much higher).The problem is that not paying will cost you a heck of a lot more than just the cost of the disputed bill.
When the item shows up as a collection item on your credit — and believe me, it will eventually — your score can drop 50-60 points or more (depending on your overall credit). Your credit card companies, who may be monitoring your credit and just waiting for an opportunity to raise your rates, can double the APR on your existing credit card balances.
And you still get hounded by debt collectors!
Here’s my advice — do what you can quickly to dispute the bill, go up the ladder, etc. You may be able to get help from your state consumer protection office, your Senator or Congressional Representatives (I spent a semester interning in a Senator’s office where all I did was help resolve constituent complaints), your local Call for Action office, a consumer reporter at your hometown newspaper or television station, or a consumer law attorney.
But don’t let it drag out too long. Before it ends up on your credit report as a collection item, consider paying it under protest, with a note that you believe it is incorrect but you don’t want to ruin your credit over it. Then take them to small claims court if you are really serious about getting your money back.
As an entrepreneur, your credit is worth far more than a few hundred dollars!
Again, as Phil said — Would you rather be right than rich?
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Good Blog. I will continue reading it in the future. Nice layout too.
Aaron Wakling
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[...] FiLife wrote an interesting post today onHere’s a quick excerptWould You Rather Be Rich or Right? Posted on March 10th, 2008 By Gerri Detweiler Would you rather be right than rich? It’s a question my friend and colleague Phil Laut asks in his books Wealth Without a Job and Money is My Friend. I love Phil’s straightforward advice for entrepreneurs, and I agree with him. This particular question is one that comes up time and again when I am answering credit questions. Here is the scenario: Your cell phone company, or medical insurance provider, or some [...]
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Wow, what a pinpoint accurate article , Gerri .
For us a “street carved” entrepreneurs , I would say to be smart , not an Egoistic . Don’t launch a “war” without ammunition. The best ammunition for an entrepreneur is , great FICO score , well executing business operations , backed up by a couple hundred thousand dollars cash credit lines and proper documentation .
Take care of what’s important for “survival” first and then , you can launch your “crusade” .
Believe me , with yours back “covered” , you are going to enjoy the “ride” a lot more …
[...] eurmarvinkirbynHYour assign bill companies, who bush be monitoring your assign and foregather state for an existence to meliorate your rates, crapper multiple the APR on your existing assign bill balances. And you assist impart hounded by debt collectors! … [...]
Very well stated and excellent advice to dispute the bill as it is stated under the ‘Fair Credit Reporting Act’ (FCRA) that the only negative information which can remain on your credit report is NOT what is accurate… but what can be proved as such.
There-fore any negative item on your credit report can only remain there if it is accurate and CAN BE PROVED AS ACCURATE under the guidelines of the FCRA.
An important point to note when considering to dispute though is that it is vital that you have good information on “how” to go about it.
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Ms. Detweiler, I am becoming a huge fan of yours. Your postings need to reach out much further than they do now. It amazes me how uninformed (colleagues of mine included) so many are on the importance of protecting personal credit. The cost of lower personal credit is HUGE! The American Dream, literally, can completely dissolve as a result of poor credit. It is an unfortunate thing – but even more unfortunate is the lack of education on this very subject. This is not taught in high school or in college and is rarely discussed among parents and kids. ( Nor is it ever a topic on those “the more you know” commercials.) Something so important as building, maintaining, and protecting personal credit is largely left for most to learn the hard way – at a giant expense.
I see that your business (XBanker/ Business Credit Success) focuses on growing and building business credit. Bravo! Unfortunately I have also been witness to many strong personal credit scores plummet when leveraged to run a business. Once again, mass ignorance the problem. Get your message out there, Ms. Detweiler – your services are WIDELY needed.