9 Simple ways to improve your credit score

9 Simple ways to improve your credit score Good credit history is important when you want to buy a house, start a business or take any type of loan. Today people are more and more dependent on credit to invest in or to buy anything. Even businesses now extend their services or products to customers based on their credit history, as they are concerned about their ability to repay.

However, not many are able to maintain a good credit score. According to FICO, almost 60% of people have a credit score of less than 750. If you are one of those with a low credit score and want to improve it, here are some positive measures you can adopt to better your credit rating.

1. Don’t Aim Big, Start Small – If you are applying for your first loan, don’t ask for a large amount because there is a high probability it will be refused. Lenders are often ready to take risks with smaller amounts and would like to see how responsible you are with your repayments. And when you make the payments on time, that gets you a positive score.

2. No Credit Card? Apply for a Secured Credit Card – If you don’t have a credit card, you can apply for a secured credit card. A deposit into your savings account serves as collateral on the things you buy with the secured credit card. After a period of time, if your repayment record is good, banks will consider issuing a regular card with a higher credit limit.

3. Gasoline or Department Store Credit Card - If you are a first time card holder or want to re-establish credit, these cards can be very useful and are easy to get. Although they offer lower credit limits, by using this card and paying on time each month, you can build your credit score slowly.

4. Always Start with One Card - Don’t accumulate too many cards. The more cards you have, the more you'll end up using them. Learn to be responsible before obtaining multiple cards. This can save you a lot of trouble by preventing debt accumulation.

5. Keep an Eye on your Credit Report – It is important to check your credit report regularly, especially before applying for a big loan. The information on your credit report is usually accurate, but sometimes mistakes or even fraudulent activities can occur. It is in your best interest to correct these issues promptly.

6. Avoid Changing Jobs Frequently – Lenders generally like applicants with job stability as it reflects their likelihood of paying regularly. This does not mean you cannot switch jobs just for the sake of your credit score, but you should be aware of the fact that this does play a role in credit loan approvals.

7. Decrease Your Debt Steadily and Consistently - The more you pay, the smaller your debt becomes. Draw up a good debt management plan and strictly adhere to it. Do not use your credit cards while paying off your debts or you will never be able to tackle your debts effectively.

8. Pay on Time - Pay all of your bills on time. Pay at least the minimum balance if you can’t pay fully. This is one sure way to build and maintain a decent credit score.

9. Credit Card Debt Counselor – If you need help with your debt management, contact a credit card debt counselor. A credit card debt counselor is a debt management expert who can help you handle your debts effectively.

Improving your credit score takes time. It is not something that can be achieved overnight, but should be looked upon as a long-term goal. Use the tips suggested above to achieve this long-term goal.

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