How To Boost Your Credit Score

by | Nov 29, 2020 | Personal Finance | 0 comments

I’ve been working on building my credit over the last 10 years. I started paying attention to my credit score when I wanted to purchase my first home. I began with a super low credit score and wanted to give you some tips and tricks on how to boost your credit score. We hope these tips help you along your financial journey!

What Is A Credit Score?

A credit score is a number given to you by the credit bureaus that basically says how trustworthy you are to pay back what you’ve borrowed. They take credit cards, bills, credit checks, and various other things into consideration when scoring your credit. The lowest score is 300 and the highest is 850. A good score is in the 690 – 719 range and a great credit score is 720 plus. You can get your credit score from any of the 3 major credit providers (Transunion, Equifax, and Experian). I recommend using Credit Karma to get your free credit score.

Why It’s Important To Have A Good Score

At some point in your life, you’re probably going to need to finance a home, car, a new toy or maybe take a loan out for an emergency. I financed my first serious mountain bike. I only did this because I was able to get 0% financing for 6 months while I paid the bike off! The point is that you want to have a great score when you need to get financed to make a purchase.

Tips On How To Boost Your Credit Score

Make Those Payments On Time

One of the biggest factors in your credit score is whether or not you pay your bills on time. You can see your credit jump quickly if you catch up on your bills and keep up with those timely payments.

Credit Hack Pro Tip:  If you are unable to pay a bill, contact that company and see if they will work with you. I’ve done this more than once to keep my credit unblemished with a pesky late payment.  Also, if you do have a late payment, see if the company will consider wiping it out. Most companies will do this if you usually pay on time.

Keep Your Credit Card Utilization Under 20%

This is so important! It’s very easy to use up a majority of your credit line when you don’t budget or keep an eye on your accounts. The credit companies weigh credit utilization very heavily. I’ve personally watched my credit score jump 30+ points just by putting a large payment towards my credit cards. Always keep an eye on your total credit utilization.

Apply For More Credit

Please take this advice with a bit of caution. If you are not a responsible spender, this might not be a good choice for you. However, if you are able to get more credit without using it, it can decrease your credit card utilization and instantly boost your credit score. If you are just starting out you might want to apply for credit cards with less strict approval requirements. It can be difficult to get some of the more widely used cards when you are beginning to build your credit.

Dispute Inaccuracies On Your Credit Report

If you find something that doesn’t look correct on your credit report you can easily dispute it.  I’ve done this using Credit Karma. If you are successful with your dispute, you will eventually see that negative item drop off your credit report. You can use this method to get a quick win and boost your credit score fast!  

Maintaining That Awesome Credit Score

Maintaining that new score shouldn’t be difficult if you follow the previous advice. Keep an eye on your credit card utilization and make sure it stays below 20%. Personally, I keep mine below 5% and pay off all credit card debt monthly before that high interest is applied.

Keep paying those bills on time and you will continue to see your score rise. Be proud of your financial achievements and your own credit score domination!

Why do you want to boost your credit score?