August 9, 2021
4 Successful Tips to Build Your Credit Score
Your credit score is tied to your financial health. This is why boosting your score and building a solid credit history is important. But many people don’t actually know the most effective tips to build their score and head down the path of financial freedom.
Today we’re going to share four tips to help you build your credit score and begin to look more attractive to financial institutions.
1. Pay Bills on Time
Paying your bills on time is crucial to improving your credit health. In fact, if you don’t pay your bills on time, it won’t matter what strategy you try to implement to improve your credit score.
This is because your payment history is the biggest factor when it comes to your score. It’s also worth mentioning that late payments can remain on your credit report for as long as seven and a half years.
If a payment does become late more than 30 days, your best option is to quickly make payment arrangements and see if the creditor will be willing to stop reporting the late payment. If this can’t be done, it’s still important to pay as quickly as possible as the longer you’re late, the more it will hurt your score.
2. Make Payments as Frequently as Possible
Another option to effectively improve your credit score is to make frequent payments. This is an especially great option for individuals who don’t have a lot of money to spare for their bills each month.
Micropayments enable you to make small payments throughout the month that can help keep your debt down. Micropayments also help build a positive payment history.
3. Dispute Credit Report Errors
This is often an overlooked method when it comes to increasing your credit score, but it’s a simple step that can be quite effective.
As things change financially, your credit report is updated. But it’s common for people to have errors in their credit reports that can negatively impact their scores. With that said, be sure to check for mistakes in your score to ensure there isn’t anything on it that could be bringing it down.
4. Keep Your Credit Cards Open
Using your credit cards to make purchases can be enticing. But using credit cards with no real plan to pay them back can lead you down a bad path. This is why many individuals who are recovering their credit score choose to close their credit cards as a way to avoid temptation.
But this isn’t as good a plan as you might think. This is because closing your credit cards can actually decrease your score as you are reducing your credit limit and increasing your credit utilization score.
If your credit score has taken a hit, it’s important to know that you have options. There are various strategies that you can implement to quickly improve your score.
With that said, make sure you pay your bills on time, make payments frequently, dispute errors on your credit report, and keep your credit cards open.