Whether you are renting or buying a home, financing a car or even taking out a personal loan, your credit score can impact your interest rate and financing terms and even your ability to qualify. Here are ten tips for pushing that credit score up!
Pay your bills on time: Late payments can hurt your credit score, so make sure to pay your bills on time each month. Consider setting up automatic payments or reminders to help you stay on track. Ideally arrange so that payment is received a few days before the due date.
Keep your credit utilization low: Your credit utilization, or the amount of credit you're using compared to your total credit limit, can impact your credit score. Try to keep your credit utilization below 30% to avoid negatively impacting your score.
Check your credit report regularly: Monitor your credit report for errors or inaccuracies that could be hurting your score. You're entitled to a free credit report from each of the three major credit bureaus once a year.
Pay off debt: Reducing your debt can improve your credit score, so consider creating a debt payoff plan and stick to it. Payoff the highest interest rates first!
Avoid opening too many new accounts: Opening too many new accounts at once can hurt your credit score, so be strategic about the credit you apply for. If you do not have any credit, start with a credit card. You’ll need to use it but even small charges that you pay off in full each month help establish credit scores. Consider charging something you already buy each month—like gas or groceries so you don’t increase your expenses just because you have a credit card.
Keep old accounts open: The length of your credit history can impact your credit score, so consider keeping old accounts open to show a longer credit history.
Be cautious when closing accounts: Closing accounts can impact your credit utilization and credit history, so be careful when closing accounts and consider how it could impact your credit score.
Use credit responsibly: Only use credit carefully and avoid maxing out your credit cards, which can hurt your credit utilization and score.
Consider a secured credit card: If you're rebuilding or first establishing your credit, a secured credit card may be an option. These cards require a deposit upfront, but can help you build credit if used responsibly.
Be patient: Improving your credit score takes time and effort, so be patient and stay committed to good credit habits. With time, your credit score will improve and so will your buying and renting options.
