6 ways to boost your credit score
Credit scores are vital for financial wellness, but getting and keeping a high score can be tricky. There is no quick and easy way to dramatically boost your score over a short amount of time, but you can take steps to increase your credit score gradually. Here are six ways to help you boost your credit score starting today.
1. Pay your bills on time
Your payment history is the most important factor in determining your score. A missed credit card payment can significantly impact your score, and it can take months to recover the loss. Set a regular reminder for a few days before your bill is due to ensure you never miss a payment.
2. Reduce your credit utilization ratio
Your credit utilization ratio refers to the amount of available credit you use. It’s best to keep your utilization under 30%, or even 10%, if you can. It can also be a good idea to accept offers of increased credit or to request an increase on your own, which can instantly bring down your credit utilization ratio.
3. Use your cards
You need to use your cards to keep your score high. A great way to make sure you use your cards on occasion but don’t overspend is to charge fixed expenses, like monthly subscriptions, to your card. Just be sure to pay the balance in full before the credit card bill is due.
4. Work to pay down outstanding debt
Pay down your bill by trimming an expense category in your budget and channeling that extra money toward your credit card bill. You can also reach out to your credit card company to ask for a lower interest rate. Finally, consider consolidating credit card debt with a personal loan from Elevate Credit Union.
5. Look for errors on your bill and credit history
A fraudulent charge on your credit card can bring down your score without your knowledge. Check your statements each month for possible signs of fraud. Contact the credit card issuer immediately and dispute it if you see anything suspicious.
6. Become an authorized user on another cardholder’s account
Becoming an authorized user on another cardholder’s account can be a great way to get quick results. Team up with someone who has excellent credit and never misses a payment; your partner’s responsibility will reflect well on you.
Now you know 6 ways to boost your credit score, which one will do try first? Did we miss something? Let us know how you have increased your credit score. And if you like this post, check out our MoneySmart Tips Blog
