The importance of a high credit score is beneficial for anyone who is looking to make a big purchase in the near future or further down the line. From buying a house to getting a loan for a car or a new business idea, credit ratings are something to be well aware of.
Improving your credit score is something that is definitely needed for living life and ensuring you can tick off all of those life goals, whether it’s spending money on a dream wedding to putting a down payment on your first property.
There are plenty of ways that you can improve your credit score, especially if it’s not at its best currently. Anything between 670 to 739 is a good rating and something you should aim for when it comes to using it for the benefit of borrowing money.
Here are a few tips to help improve your credit score greatly in the future. Your future self will certainly thank you for it.
Check your credit score
First and foremost, check your credit score. It’s important to understand what your current rating looks like and how this might influence your efforts going forward. You might find that the credit score is a lot better than you think and therefore it’s not something that will need much in the way of progress.
However, this could be the opposite, where you think it’s not too bad but due to a few bad spending habits and mistakes, your credit score is a lot lower than expected.
You can check your credit score easily on any of the three major credit companies; Experian, Equifax, and TransUnion. You can also visit AnnualCreditReport.com. These are all useful platforms to get a free credit report without it affecting your credit score itself.
Checking your credit score is going to help give you a starting point of where you are and where you need to end up. By knowing what your score is, whether it’s good or bad, at least you know now what you need to achieve in order to get to a healthier score.
Identify any potential mistakes
Sometimes mistakes get made and when it comes to your credit score, you might find that it’s worth reviewing your credit score and where it might have dipped by mistake. If you have concerns that your credit score has dropped significantly and nothing has necessarily changed since you last checked your score, then you could always query this.
Even if it’s a valid drop, at least you’ll understand why it’s happened. However, if it’s a clerical error or tech fault that has caused your credit score to drop, then you might be a lot higher up if you end up getting it corrected.
Identifying mistakes is important and it’s also influential, especially if you’ve had your credit score lowered for no reason.
Pay your bills on time
Bills bills bills – we all have to pay them. It’s something that sadly, we cannot escape from, unless that is, you live in the comfort of your parent’s home. Bills are part and parcel of life for most people and are something that just needs to get paid as and when they’re needed each month.
If you don’t pay your bills, then the likelihood of bill providers coming after you with late fees is very much possible. That may also cause some problems with your credit score if you’re constantly paying your bills late and incurring late fees as a result.
There are some bills that you could likely get away with saying sorry and that you’d simply forgotten. However, some bill providers will not allow you to step out of line so easily.
It’s important that if you don’t have the money to pay your bills on time, something changes to ensure you can. Either that or that bill you’re paying, if it’s a luxury or not needed, will require canceling.
Make sure your address is correct
A common mistake that gets made when it comes to improving a credit score is your address. If your address isn’t correct, then that could impact your score. However, it’s important to note that you don’t need to worry about removing any addresses and worrying if this would impact your score – it doesn’t.
However, making sure your address is up to date, will help keep all of your records and tracking of those financial records, accurate. There’s nothing worse than realizing all of your efforts have been for nothing when your address isn’t matching up to the information that is held by these credit companies.
Get in touch with one of the providers above and get it changed if it’s something that needs fixing.
May regular payments via your credit cards
While it’s important to have a credit card to boost your credit score, it’s not recommended that you have too many credit scores on the go. Why? Well, if you miss a payment on one of them or more, then this could do the opposite of improving your credit score.
Ideally, stick with one credit card and only take on another if it’s absolutely necessary to build your credit score quickly.
Chances are, you’re not going to need multiple credit cards unless you are intending to borrow a lot more money over a longer period of time. With that being said, it’s important that you’re making regular payments via your credit card.
Make sure you’ve got a direct debit set up so that you can pay your monthly credit card payments on time. By doing this, you’re not going to easily forget and cause unnecessary damage to your credit score as a result.
Avoid multiple applications
When applying for credit cards or assessing your credit score for borrowing money, it’s worthwhile spreading out these applications over time. You don’t want to do too many applications if each one is going to impact your credit score.
Unless they’re guaranteed not to impact your credit score, then it’s worthwhile to be wary of how many applications you’re filling out. It’s easy to get caught up in these applications, especially if you’re wanting to borrow money quickly. However, try to restrain from doing it as this could impact your credit score negatively.
Consolidate any debts to improve finances
To help with debts and to improve your credit score, try consolidating all of your debts into one place. It’s a much better method of paying off debt by having it all in one place. You might find that currently, you’re paying off debts left, right, and center. This could also be incurring interest fees that are only prolonging your ability to pay off your debt.
Consider what financial options and providers are out there to help consolidate the debts and pay them off quicker.
Buy from reputable companies
Finally, when it comes to making purchases offline or online, always make sure that the companies themselves are reputable. There’s nothing worse than spending your money on places that are going to charge or scam you out of money and in turn, affect your credit score as a result. Be careful when shopping online in particular as there are a lot of scams out there.
Improving your credit score is something you definitely want to do, especially if it’s not currently looking that healthy. With these tips, you’ll be able to get your credit score to a healthier position than it’s ever been. From there, you’ll be able to borrow easily and at better rates!