5 Simple Habits to Boost Your Credit Score Today

Improving your credit score might seem like a slow and complicated process, but small, consistent habits can make a big difference. A better credit score opens doors to lower interest rates, better loan approvals, and more financial freedom. This post shares five straightforward habits anyone can adopt to start improving their credit score right away.

Pay Your Bills on Time Every Month

One of the most important factors affecting your credit score is your payment history. Late payments can stay on your credit report for up to seven years and significantly lower your score.

• Set up automatic payments or reminders to avoid missing due dates.

• Even paying a day late can hurt your score, so aim to pay before the deadline.

• If you struggle with multiple bills, prioritize credit cards and loans first.

  
  

For example, Sarah improved her credit score by 50 points within six months simply by setting up automatic payments for all her credit cards.

Keep Credit Card Balances Low

Your credit utilization ratio is the amount of credit you use compared to your total available credit. Experts recommend keeping this ratio below 30%.

• If your credit limit is $5,000, try to keep your balance under $1,500.

• Paying off your balance in full each month is ideal.

• If you have multiple cards, spread out your spending to keep utilization low on each.

  
  

John noticed his score jumped after he paid down his credit card balances from 80% utilization to under 20%.

Check Your Credit Report Regularly

Errors on your credit report can drag your score down unfairly. Regularly reviewing your report helps you spot mistakes and fraudulent activity.

• You can get a free credit report from each of the three major bureaus once a year at AnnualCreditReport.com.

• Look for incorrect personal information, accounts that don’t belong to you, or wrong payment statuses.

• Dispute any errors you find promptly with the credit bureau.

  
  

By catching a fraudulent account early, Lisa saved herself from a long credit repair process and kept her score intact.

Avoid Opening Too Many New Accounts at Once

Each time you apply for credit, a hard inquiry appears on your report. Multiple inquiries in a short time can lower your score.

• Only apply for new credit when necessary.

• Space out credit applications by several months.

• Opening several new accounts quickly can signal financial distress to lenders.

  
  

For instance, Mark waited six months between credit card applications and saw a steady increase in his credit score.

Build a Long Credit History

The length of your credit history accounts for about 15% of your credit score. Older accounts show lenders you have experience managing credit.

• Keep older credit cards open, even if you don’t use them often.

• Avoid closing accounts just because you don’t use them regularly.

• If you’re new to credit, consider becoming an authorized user on a family member’s account with good history.

  
  

Emily kept her first credit card open for over 10 years, which helped her maintain a strong credit score despite opening new accounts.