No matter why you want to boost your credit score, most people can. Your credit score tells potential lenders just how safe you are to lend money to. If your score is bad, they may refuse to give you credit.
Did you know that those who have never had a credit card before can have a low score?
It seems odd that credit scores can be low because someone hasn’t needed a credit card.
However, this is the reality. So, what can people do to make their scores better?
Read on for some tips and tricks.
1. Keep Track of Your Monthly Bills
Keeping track of your monthly bills can help to reduce the risk of missed payments. When you miss a payment you may be charged fees.
Note down what your monthly bills are and pay them when you can. You could also:
- Keep a digital or paper filing system for your bills
- Include household bills, your warranty and insurance bills, car payments, etc.
- Set alerts on your phone or computer so you know when you need to pay a bill
- Consider scheduling automatic payments from your bank account
When you begin to keep track of your monthly bills you’re more likely to stay on top of them. This can have a hugely positive impact on your credit score.
2. Spend Less Than 30% of Your Credit Card Limit
Known as “credit utilization”, spending less than 30% of your credit limit can help. Try to pay your credit card balance in full every month. If this is impossible, pay as much as you can.
Try to keep your credit card’s outstanding total less than 30%. Keeping your total low can help to improve your credit score. Keeping your credit card’s outstanding total down to less than 10% is even better.
3. Stop Asking For Credit
Each time someone asks for more credit their request is noted. The fewer requests you make, the better.
While cutting down on requests won’t make a huge difference, it can help.
4. Consolidate Your Debts
Debt consolidation involves someone putting their outstanding debts into one place. The benefits of debt consolidation include:
- Making one monthly payment
- Having a better idea of how much you owe
- The likelihood of having to pay less interest
- Not needing to pay interest for a short while depending on the promotion running
- Being able to cut up old credit cards
Debt consolidation can be hugely beneficial. They can give you more control over your finances and this is never a bad thing.
Use the above tips to help you to boost your credit score. When you do, you’re more likely to be accepted for mortgages, car finance packages, and credit cards. t may take a while for your credit score to change, but it’s worth working on it now so that it starts to improve.
You never know, in 5-10 years, your credit score could be better than it has ever been.