Your credit score can have an impact on many aspects of your life, including where you live, what you can do in your free time, and what kind of car you drive. It can even affect your career.
Improve your score can seem like a daunting task, but there are many easy steps you can take to boost your number.
Keep an Eye on Your Score
If you are not currently watching your credit score, you may want to search “check credit score” online and get started. Staying up to date will help you take control of finances. You will know when that number rises or falls and why. You can also identify issues and address them before they become bigger problems.
While you may not need to check in every day, you should review your status periodically. If you are doing anything that might have an impact on your score, such as applying for loans, you will want to monitor it more closely.
Stay on Top of Your Payments
Your payment history is the biggest factor affecting your credit. Managing your debt payments should be a top priority. You may want to turn on an autopay feature so that you never miss a payment or set alerts so you remember your next due date. As you make consistent and timely payments, your credit score will improve.
Manage Your Utilization Rate
Credit utilization refers to the percentage of your total available credit that you are currently using. For example, if you have a balance of $750 on a card with a $3,000 limit, your utilization rate is 25%. If that percentage gets too high, your score will take a hit.
When possible, you should aim to keep your credit utilization below 30%. To do this, you may want to pay down existing balances before charging anything else to your card. If you are not at risk of overspending, you can also ask for a limit increase.
Check Your Credit Report for Errors
Errors on your credit report can unfairly damage your financial reputation, so you should periodically check your report for any mistakes or missing information. You can dispute any inaccuracies with the major credit agencies. Don’t let errors on someone else’s part negatively impact you.
Use Credit Monitoring Tools
Monitoring tools are becoming increasingly popular because they alert you to changes that you will want to know about. These tools can help you keep track of your progress and identify areas where you need more improvement. They often offer suggestions about ways to improve your score further.
Make Sure Everything Counts
For people with thin credit files, there are many tools available that can help by looking at financial information that would not normally count toward your credit history, like rent and utility payments or banking history. If you have a good track record in these areas but do not have many open accounts, you may want to look into tools that can give you the boost you need.
Apply for a Secured Credit Card
A secured card requires a down payment and has a low limit, but they are a great option for improving your credit. Even with a bad report, you are likely to get approval. However, as with any credit card, you should make sure the issuer reports to the major bureaus if you want to see it count towards your payment history.
Improving your score is not an impossible feat. You can take many easy steps to boost your number, and with a little patience and financial responsibility, you will see a better credit score.