Here are three easy ways to increase your credit score

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Americans, by and large, have pretty good credit ratings. Almost six in ten Americans have “good” credit ratings or better. according to Schufa Experian.

That’s a FICO score of 703 in case you’re wondering. FICO credit points range from 300 to 850.

This is good news because your creditworthiness is crucial when considering a mortgage. open a credit card, rent an apartment and even some vacancies. But there is still about 12% of Americans who have a score of less than 550, which is considered mediocre to poor.

If you’re one of those with a lower score, there are ways you can improve your credit score, says Tiffany Aliche, personal finance expert and founder of The Budgetnista.

Remember that increasing your score usually doesn’t happen overnight. Experts say it is possible to get your score up in a month or two, but it may take longer depending on why your score is low in the first place.

Here’s a look at three simple things Aliche says that you can do to get started.

1. Automate your bill payment

The most important thing you can do to improve your credit score is to improve and maintain your payment history. “That means you pay what you owe and pay when you owe,” says Aliche.

An easy way to do this is to automate your payment. Set up billing at your bank so you never miss a payment. “If you automate it, you don’t have to think about it – just set it up and half forget it,” she recommends.

Your payment history makes up the bulk of the calculation of your score, around 35%, Aliche says. It is therefore important to keep track of how your bills have been settled. It’s worth noting, however, that not all bills will count towards your credit score. Accounts that can help or harm your score usually include credit cards, retail cards, car loans, and mortgages, according to the credit scoring service company FICO. (That’s not to say you shouldn’t pay all of your bills on time.)

2. Piggyback on good credit habits

Another easy win in boosting your credit: become an authorized user. This is an especially great tip if you are just starting out and may not have a strong score yet.

If you have a parent or family member with good credit, you can ask them to add you to their credit card as an authorized user. “I have great recognition,” says Aliche. “Baby sister Lisa, not so much.”

To help her, Aliche added her sister as an authorized user. But Aliche didn’t allow her sister to get a card, so there was no danger of spending too much. “What it meant was that if I used my card correctly, it would look like we were using the card properly,” says Aliche. “So she inherited good financial behavior.”

While this can be a helpful strategy, fewer than 1 in 5 people have been added as authorized users. according to credit sesame. The finance page found that joining as an authorized user helped people with bad credit scores below 550 improve their score by 10% in just one month.

3. Use your credit card to “cash out pennies”

Leaving your cards gathering dust may mean you’re not spending too much, but it can cause problems. If you don’t use your credit card, an issuer can deem the account inactive and close it. This could decrease your overall available credit and increase your usage rate.

Loan utilization, as it is called, is the ratio of the money you have on your credit cards to the total amount of credit available. And it plays a huge role in calculating credit risk, and therefore creditworthiness. Using more than 30% of your available credit will typically lower your credit score as it signals to credit card companies that there is a greater risk that you may not pay everything off, or that it may take a while.

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To combat this, Aliche recommends cashing out your pennies. By what she means, if you have a credit card that you don’t use that often and that has zero balance, use it to pay a very cheap bill.

For example, if you have a $ 25 or $ 30 recurring expense, maybe a gym membership, write it down on your credit card and then pay it off. You can of course automate your payment so you don’t forget about it. The key is to make sure the withdrawal is made after you receive the statement by email or mail and before the due date. That way, you’ll keep the card active and paid off, which will benefit your usage rate and your overall score.

“If you do these three things, your credit score will jump, jump, jump, jump,” says Aliche.

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Disclosure: NBCUniversal and Comcast Ventures are investors in Acorns.

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