This post may contain affiliate links. We may receive a commission on purchases made through links at no extra cost to you. Thank you so much for supporting this site. Read the full disclosure here.
What do you think of when you hear the word credit score? Some people have good thoughts, while others try not to even think about it. According to Investopedia.com a credit score is a numeric expression of a person’s creditworthiness that is used by lenders to access the likelihood that a person will repay his or her debts. A credit score is a number that is between 300 – 850. The higher your score, the better the opportunity is for you to get a credit card or loan with good interest rates.
Your credit score consists of five categories. They are your payment history, the length of credit history, amounts owed, types of credit used and new credit.
I check my credit score at least once a month. Ever since it increased by 168 points in 9 months, I’ve been addicted. I like to know where I stand and what I need to work on. If you don’t have the best credit score, there are a few things that you can do to increase it.
You can request 3 FREE copies of your credit report. The three major credit bureaus are Transunion, Experian, and Equifax. Each credit bureau will allow you to get your free credit report once a year. It’s important to get your report from more than one company because there could be discrepancies on there. Take the time to review each report. If you see any inaccuracies, contact the credit company immediately.
Make On-time Payments
Make sure that you are making on-time payments for all of yours bills. 35% percent of your credit score is your payment history. That’s more than a third of it. If you pay your bills late each month, you have to change that. Besides the effect on your credit score, paying your bills late will cause you to have late fees. Late fees can be anywhere from $20 – $50. Imagine having to pay that one several types of accounts. Pay attention to your due dates and pay your bills online.
Pay Your Credit Card In-Full Each Month
Another thing that will help you when you are getting your credit score in order is to pay your credit card in full each month. I’m not going to lie. For some people, this one will not be easy. Some people tend to use their credit card for all their shopping and only make the minimum payment each month. If you want your score to get higher, you have to develop a little bit of discipline and watch your credit card usage. If you have a high credit card balance, you should do whatever you have to to pay it down. Once it’s at zero, use it wisely and pay it in full each month.
I also use a website called Credit Sesame. It provides you a credit score and so much more. It differs from Experian, Transunion, and Equifax in the fact that it provides recommendations. For example, it shows you credit cards that you could qualify that has a low APR. It also shows you an overview of your total debt. It allows you to see everything in one place. For more info, sign up here. (It’s free.)
If you are working on getting your credit score in order, I want you to know that you can make it happen. I’m living proof. My credit score was flat out bad at the beginning of 2015. I was able to get it better. Make sure that you use a website that says you can get your credit report for free. There are others out there, but some will try to charge you money to see your score. Don’t be a victim and pay for something that you can get for free!
What are some ways that you are working on getting your credit score in order?