As we can see in the below video, credit scores are essential to ensuring you can get loans in the future. Without a good credit score, there is no way that banks will trust you to give you a loan of any kind. You can tell them you’ll pay them back, just like a school student can say they are a straight-A-student, but without looking at the student’s grades, there is no substance to his/her claim. A credit score gives banks the hard facts they need to say they can trust you with a loan.
Source: Credit Karma
Keeping a high credit score is paramount to a healthy and stable financial future. Here are some ways you can improve that credit score, because every effort to this end counts!
Before opening new credit card accounts, make sure to consider the below pros and cons of doing so and make sure your credit score is at a good enough place to handle opening a new line of credit.
Sign up for and use about four credit cards throughout any given month. John S Kiernan, Senior Writer & Editor and WalletHub, shares, “The average credit card user had 3.7 cards in 2014, according to Gallup, and WalletHub’s editors believe that around four cards is indeed the number that provides the most benefit without making life overly-complex.”
Reduce spending beyond the recommended 30% of your line of credit each month by capitalizing on your credit cards’ rewards programs. To capitalize off of your diverse credit card portfolio and further reduce the amount of spending you do on each credit card, meet with or talk to someone at the company that each credit card belongs to in order to figure out what rewards each card offers. These rewards can change, depending on the type of purchase or time of the week, month, or year. Keep a record of when various rewards come into play for each rewards card, and use that card when it is most financially beneficial for you.
Get each of your credit card companies to send you an alert when you’ve almost used 30% of your line of credit each month. Then, switch to the next credit card until you reach 30% of usage on that card, and so on and so forth.
Pay off your credit card balance multiple times throughout a month. One way to do this is to set a calendar reminder on your phone, tablet, laptop, or desktop to go off at the same time each week. Oftentimes, this day of the week can be Sunday, when some people take time to prepare for the work week ahead. For example, set a calendar event called, “Pay Credit Card Balances,” with two email reminders–one that sends you an email one day before the calendar event and one that sends you an email one hour before you scheduled yourself to pay your credit card balances. This will keep this task on your mind each week without forcing you to remember it on your own. Use this article to help you determine when to pay off your balances in a way that best affects your credit score.
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