You know the importance of a high credit score: it can affect whether or not you can get loans and what sort of interest rates and terms you’ll be eligible for.

So how do you raise your credit score and keep it high? Here are a few tips:

Pay your bills on time. This may seem obvious, but it’s important. Depending on how the creditor reports information, missing a due date by just a few days can damage your credit rating—not to mention cost you in late payment fees.

Maintain credit card balances of approximately one-third of your total available credit. Maxed out credit cards can lower your credit score. If you have a credit card with a $5,000 limit, keep your balance no higher than $1,700. If you have credit cards that are maxed out, apply for a credit line increase—but don’t use it!

Don’t close older unused accounts. Creditors like to see history, and the longer the better. So if you have an older account you don’t use anymore, don’t close it. Or, if you’ve transferred a balance to get a more favorable rate, don’t close the old account; just stop using it.

Have and use more than one credit card. This lets lenders see that you can manage multiple debts.

Apply for credit only when you need it. Don’t be tempted by offers such as “get 10 percent off your purchases today if you apply for a card with us.” Multiple credit inquiries can reduce your credit score. Make credit applications only when you need it and consider them carefully.

Review your credit reports regularly and correct inaccuracies immediately. Get a free copy of your credit report once a year (one from each of the three major agencies) at www.annualcreditreport.com.

Jackie
Chief Blogger
Wealth Intelligence Academy