Improve your credit score! Whether you’re addicted to high-tech smartphones or barely use email, here are some everyday tips you can implement. These routine practices will propel your credit score to the top of the charts:
1: Make sure your credit report is accurate. If your credit score is calculated from the wrong information, you may be in deep trouble. It is estimated that 25% of credit reports contain some type of error.
High-tech way: You can request a copy of your credit report from annualcreditreport.com once every 12 months at no charge. This website is provided by the 3 major credit bureaus. Reviewing your credit report is a great way to catch any errors before they damage your credit.
Low tech way: You can request your credit report by phone or by mail. By phone: Call 1-877-322-8228 and you’ll go through a simple verification process. Your report will be mailed to you within 2-3 weeks. Via email; Download and complete the Request Form (available on the website) and mail it to the Annual Credit Report Request Service
PO Box 105281
Atlanta, Georgia 30348-5281
Your report will be delivered in 2-3 weeks
2: Pay your bills on time. Payment history is 35% of your credit score, so paying your bills on time should be a priority.
High-tech way: Tech lovers have many options of apps that can be used to track expenses and pay bills. mint and pageonce are 2 of many apps that can set up all your invoices in one place. These apps remind you when bills are due, track expenses, etc.
Another way to make sure you don’t miss any payments is to set up automatic payments from your online banking to your mortgage, auto, and credit card providers. This will ensure that you don’t rack up late payments, which can affect your credit score.
Low-tech way: If you’re still walking to the mailbox to get your bills, implement this practice; Pay your bills the day they arrive. This may seem a bit harsh, however, paying for them when you receive them has its benefits. The bill won’t have a chance to get lost in the pile on your desk, AND you won’t have to think about it anymore.
Another low-tech option is to have a desk calendar that has all your monthly bills marked on the date they are due in the mail (not the due date). Put the calendar in a place where you can see it every day, so the due date doesn’t slip by.
3: Keep your credit card balance low: After paying bills on time, account balances are the biggest factor in your credit score (30%). Bringing credit card balances near the limit has a dramatic negative impact on your credit score. Don’t let this happen to you!
Hi-tech fashion; As mentioned in #1, there are many apps that can help you track your spending and budget. By following a budget, you can see where your money is going and plan for larger expenses (new furniture, vacations, etc.) without carrying your plastic.
Low tech way: take paper and pencil and make a budget. Track your spending to make sure you know where your money is going. Open all your credit card statements the day they arrive and do your best to pay off your balances each month.
High-tech and low-tech tip: While responsible credit card use DOES help boost your score, it’s an all-around good financial practice to make sure you’re not racking up useless debt.
If you end up using your credit cards and can’t pay the balance each month, MAKE SURE you don’t charge more than 30% of your limit (for example, on a credit card with a $10,000 limit, never charge more than $3,000). Keeping your balances low will go a long way in raising your credit score.
4: Don’t close, lose, or ignore those old credit cards. The length of credit history is 15% of your credit score. The optimal credit history is 30 years! Work hard to make sure those old credit cards are doing their job to boost your score.
Remember, credit cards must be used once every 6 months to be included in your credit score.
High-tech way: Set up one of your bills to automatically charge your oldest credit card. It doesn’t matter how small the amount is. Any new balance will bring that credit card up to date with the credit bureaus so all that great credit history shows up on your credit report.
Low-tech way: Carry your oldest credit card in your wallet and be sure to use it once a month for gas or groceries. This purchase will keep your card active and counting positively on your credit report. Pay at the end of the month so you don’t have to pay any finance charges.
Putting some or all of these tips into practice can go a long way toward maximizing your credit score and securing the best rates on your mortgage, car, and credit card loans. And, whether we’re high-tech or low-tech, this is an attractive goal for all of us.
