How You Can Boost Your Credit Score

First impressions are lasting, and when it comes to the financial world, most notedly filling out a credit application, your score is the impression you make on the lender, and is not only what decides the rate and terms, but is the major deciding factor in your approval or denial. The higher the credit score, the better the interest rate you are granted, thus saving you the most money every month.  The more you can give your credit score a boost by maintaining a few responsible behaviors, the more you’ll be able to save going forward.

Check Your Credit Report

The amount of fraud you hear about these days is ridiculous.  From having your card information taken in a matter of seconds if you leave it out in the open you can receive notifications from your credit card company almost immediately asking if the transactions were legit.  You can stay on top of this by checking your full credit report at least once a year to make sure that all accounts are accurate.  In addition, on each credit card statement, your score is now included, so you can monitor to make sure that there are no sudden impacts to your score that you would need to follow up on.

Make On-Time Payments

The, hate to say, easiest way to make sure that your credit score does not take any sudden dips is to make your payments on time.  Now ‘on time’ when it comes to credit purposes, means that payments must not be thirty days late, otherwise the credit score can take a major hit.  While that seems like that should be no problem, people make mistakes, and even if an accident it can stay on your report for years.  It’s a good idea to schedule payments in advance, when even though being a day late will not hurt your score, you can still get charged a late fee or have a spike in your interest rate.

Minimize Credit Utilization

This one will take discipline, but keeping your balance low and having a large amount of available credit will help keep your credit utilization low, and your credit score high.  Carrying over a balance to the next month not only will reduce your credit score, but will also start having interest charges in effect, which can be an easy way to get into debt.  Making the minimum payment needed to satisfy your statement balance will do little to chip away at the balance, so making the largest payments you can afford until the balance is good is your best bet, even if that’s easier said than done.

Limit Applications

While having your credit pulled will only take away a few points from your score, it just means to be careful on how many applications you’re submitting, as you want to make sure they will help your finances, such as a refinance to lower your mortgage rate (or take cash out to pay off debt), or finding a better credit card with rewards where you can earn points or cashback on the purchases you would be making anyways.