Debt Management Tip: What You Can Do To Help Your Credit Score

There are a lot of myths and misinformation about credit scores floating around out there – what really hurts your credit score? What raises your credit score?

And credit card companies are not exactly a goldmine of information about credit scores.

Here are some of the biggest factors that help your credit score:

1.) Have credit cards, and use them regularly. If you have never had line of credit, or don’t have any that you use regularly, then credit scoring companies have no way to determine what you are like as a customer and whether you are a good credit risk.

2.) Don’t charge too much on your credit cards. Ideally you will pay off your balance in full every month so that you don’t have to pay interest. If you can’t do that, then at least do not charge more than 35 percent of your credit limit. If you have a credit limit of $10,000, then if you owe more than $3500 you will start to see your credit score fall.

3.) Pay your bills on time every month. This is huge. This accounts for about a third of your credit score.

4.) Check your credit reports regularly to make sure there is no inaccurate information on them dragging your score down.

5.) When you are shopping at the department store and they say “Would you like to save 10 percent on your purchase today?” – Just resist. They will have you apply for a store credit card. Every time that you apply for new credit this hurts your credit score a little bit. Old credit lines that are paid off on time are valuable and help your credit. Applying for new credit hurts your credit score.

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