4 Ways to Easily Boost Your Credit Score

By Alicia Geigel on December 16, 2017

Regardless of if you are young or old, the idea of building credit and maintaining a good credit score is not only complicated but also overwhelming. Having a good credit score is necessary for many things in life such as: owning/renting a home, purchasing a car, getting a loan, securing a credit card, etc. Many people, especially college students, are often unsure of what credit is, how to start building credit, and how to maintain a good credit score. Before I delve into how to build credit and maintain a good score, it is important to know what exactly credit is and why it is so important.

According to Experian, simply put, “a credit score is a number lenders use to help them decide how likely it is that they will be repaid on time if they give a person a loan or credit card.” There are a few factors that influence your credit score and make it either look good or bad, which are: the total amount of debt you have, the number/types of accounts you have, the amount of late payments you made, and the age of accounts you have.

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Credit scores are used by lenders so they can have a general idea of the time period it will take for you to repay debt and this system is not going anywhere. So, in a world defined by financial responsibility and credit scores, how can you be sure to have a good score and keep one?

If you do not have credit, have a bad score or are looking on ways to improve your score, my four tips will help you get started on working your way up to a near perfect score- and maybe after reading these you’ll be able to get that new car of your dreams!

Now that we know what credit is, what influences credit and why it exists, the next element we need to briefly discuss is the numerical value of what constitutes a good score, a middle score and a bad one. According to Gerri Detweiler of Credit.com, “most credit scores operate within the range of 300-850 and within that range, excellent to bad credit scores are the following: excellent credit = 750+, good credit = 700-749, fair credit = 650-699, poor credit = 600-649, and bad credit = below 600.”

Keep in mind, however, that some lenders have different scales, but all are generally within the same range. Essentially the rule is the higher the score, the better it will be. Keeping in mind this information, lets go into the best ways to build credit and keep a good score!

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1. Apply for a Secured Credit Card: This is perhaps the most common way to establish credit because it is safe and effective. When you apply for a secured credit card, you enter in basic information like name, address, and employment history. After sending the application, you’ll hear back shortly whether or not you are approved (chances are you will be approved 99.9% of the time).

When you’re approved, you simply make a cash deposit which is typically the same as your credit limit- if you deposit $100, your limit will be $100. It’s as simple as that! You use your secured credit card just like you think, you make purchases and pay off your payments before by due date.

According to Erin El Issa and Bev O’Shea of NerdWallet.com, “Secured credit cards aren’t meant to be used forever. The purpose of a secured card is to build your credit enough to qualify for an unsecured card — a card without a deposit and with better benefits.” Just consider this a starting point for something bigger and greater that will bring your score to an almost excellent level!

2. Always Make Payments on Time: This is imperative to not only building credit but also keeping a good credit score. It may seem simple — but that’s because it is. If you are someone who is always on top of payment due dates, then you will most likely have no problem building credit. If you get side-tracked and forget about payment dates, get a calendar or set reminders on your phone a few days before the payment is due to remind yourself to pay. Having a 100% payment record shows that you are responsible and make payments.

3. Don’t Go Crazy Opening Accounts: The logic when it comes to building credit is, the more accounts you have, the greater your credit score is. This is true, but be careful of when you decide to open new accounts and how many you open at once. According to El Issa and O’Shea, “new accounts lower your average account age, which makes up part of your credit score.”

4. Keep Accounts for as Long As You Can: An important part in demonstrating your credit/payment history is through the different accounts you have open. The longer you have accounts open, the lengthier your payment history and credit utilization will be, which is a big plus for lenders.

Though building credit and keeping up with your credit scores (and not the Kardashians) can be daunting and discouraging, there is always a chance to improve and build. After reviewing my tips, I am positive you will be able to get your score to your preferred level! As always, good luck!

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