You never know when a good credit score will come in handy. Perhaps you want to apply for a mortgage on a house or a loan for a new business that you want to start. Whatever the case, there are many things which affect your credit score which are worth being aware of. In this blog post, we will run through a few of the ways that you can strengthen your credit score.

Build from the Bottom

First of all, you should pay your bills on time so that you don’t establish yourself as a ‘later payer’. If you automate your bills from your online bank account, this helps you not to forget every month. Another thing which credit score companies can look at is whether you can hold down a stable job. Many places will also look at your living situation and how often you have moved home in the past few years.

Improve Existing Scores

When you apply for a credit card, try to choose one that offers a low interest rate and a cash back percentage on the purchases that you make. Recognized companies such as Visa, American Express, Discover, or Mastercard are the best options. Keep your debt as low as possible. If you have started to build a decent credit score and you are slightly late on a payment, you may be able to get this removed from your score by asking. The longer you have good credit, the more of a ‘safe bet’ you will seem to potential lenders.

Use Credit Cards Responsibly

When you are using credit cards, you should always aim to be a responsible user. Having a household budget is important so that you don’t overstretch yourself every month. While making a budget may seem easy, it is sticking to it which can end up being the challenging part. When you use your credit card, make sure that it is for small purchases that you can afford. You should be able to make more than the minimum payment every month. You should also aim to be well below your credit limit at all times. Try not to get any closer than 70-75%.

Master Your Credit Score

You can check your credit report on an annual basis so that you know exactly where you are at. You should dispute anything that doesn’t look right such as additional accounts that aren’t yours, late payments that were paid on time, and bankruptcies older than 10 years which are still listed. If you apply for personal loan, making sure that everything is taken care of on time can have a positive impact on your credit score. When you have credit cards, make sure that they are being used. Otherwise, your credit score can end up going down.

So, there you have just a few basic tips which can end up having a big impact on your credit score. Ultimately, it is always a good idea to be well informed financially.