My debt repayment plan officially started again in January 2015. I vowed to get current on all my bills and start the process of eliminating my debt. So far it has been an interesting journey. Besides seeing the numbers get a little smaller each month, something else happened. My credit score went up by 168 points in only 8 months. That was amazing. When I checked my score last August I was in complete shock to see that much improvement. In today’s post, I want to share with you some things that I did to make it happen.
The first thing that I did was get current on every bill that I had. It didn’t matter if it was a student loan or credit card bill; I made sure that I got up to date with each and every one of them. I also set up automatic payments for a couple of my bills. That was huge for me. I’ve never had the discipline to do that in the past, but I was focused on making this happen. 35% of your credit score is your payment history. I had to make sure that my payment history was getting better.
The next thing that I did was that I stopped using my credit cards. By just paying on them, my credit utilization ratio started going down. I’m not at the recommended 30% yet, but I am damn sure lower than the 90% that I was at last year at this time. With hard work, I should be under 50% by the end of the year.
I also started adding extra money to all my debts. I’m not sure how much that helped, but it was something that I had to do.
I’m still amped at how much the score went up in 8 months. I’m proof that even if you have thousands of dollars of debt you can still raise your score. If you have a low credit score I want you to realize that you can raise your score too. You just need to create a plan. Remember, 65% of your credit score consists of your payment history and the amounts owed.
One tool that I use when I’m looking at my credit score is credit sesame. Credit sesame has a financial debt analysis tool that shows you your total debt. It then breaks the debt down into categories such as credit card debt, student loans, and others.
Credit Sesame also goes into detail about your credit score and credit report. They also give you several credit recommendations. Those recommendations could be credit cards that you can sign up for or personal loans that can help you pay off high-interest debt.
Did I mention that credit sesame is free to use? All you have to do is sign up. If you’re interested in getting your credit score in order click here!