Remember when you were in high school and the irritating school office thoughtfully mailed your parents a report card every term? Sure, you could have a lot of fun for a few weeks, but there was eventually a reckoning. A credit report is the grown-up version of a report card, and like most grown-up versions of things, it’s a whole lot less fun.
Every time you get a credit card, open a bank account, sell a car, buy a house, pay a fine, rent an apartment, or close a bank account, it ends up on your credit report. And it stays there for a long time—usually about ten years. If you miss a payment to the city utility, it’s noted on your credit report. If you’ve declared bankruptcy, been evicted, or paid off a signature loan, it’s noted on your credit report.
Been divorced? Lived someplace else? Have an embarrassing account at an adults-only mega-store from that one time you visited Las Vegas at the end of 1999? It’s on your credit report. In fact, most people are flat-out stunned the first time they review their credit report, because it has everything. And that’s the very reason it’s important to be fiscally responsible, even when it seems like nobody is looking.