Credit Rating vs Job Worthiness

Recently stock markets went crazy when S&P downgraded the credit rating of US. We have a kind of environment in the financial market where the countries rate other countries before lending. We have companies with credit rating which helps in enjoying better credit facilities and attractive interest rates.  When it comes to individuals we are also rated for our credit worthiness. I am not a finance pro to go into the details of the various components of this rating mechanism. However from a commoner point of view I can tell you how an individual’s credit rating affected.

Banks and other financial institutions  submit the data of their borrowers(which is us) to the credit rating agencies which closely monitor for defaults, disputed payments etc.  If we lapse in our repayment of our EMIs of Housing loan or a personal loan the rating is going to take a hit. This will affect the chances of getting another credit card or even a top-up loan. We might argue with the Credit card issuer with a dispute over the billing in our card statement. We might even win an argument  and decide to bargain and pay a fraction of the amount and think we have gotten away. But what we do not realise at that moment is , the credit card issuer has already reported  our status as defaulter. That is a blemish on our record.

If you are too young and have just have begun your career, you definitely cannot afford for such mistakes because you have a long list of loans you might take in the next 20-25year period for buying a home, car etc and it is never a one-off relationship with any bank. Mind you they are so well integrated to share the data and you will have nowhere to go.

That reminds me again of  Sheldon Kopp’s escatological laundry list item no

41. You are free to do whatever you like. You need only face the consequences.

Thank god we don’t have a similar system of rating the individual’s career or Job worthiness yet.  Just imagine a central database with ample inputs from employers rating the job worthiness of the individual. Do not worry, it may never happen for the simple reason because of the volume of subjectivity involved in rating the individual….some may vehemently protest this subjectivity but when was the last performance review done objectively…??

I welcome your thoughts on this post.

I, as ever, really appreciate your time and attention. If you would like to get these posts via email, just enter the details in the sidebar on your right and you will never miss a post. If you like to share this post with friends you may use the links below.