Your credit score should stay in good shape; it goes without saying. You don’t want to hurt it, probably reducing your chances of borrowing money when you need it the most. With this in mind, using your credit card wisely is just one of the ways you can boost your credit score. Let’s dive right in.
Are You Paying Your Bills on Time?
If not, you might be compromising your credit score. Yes, this goes beyond just avoiding paying that late fees, but paying your bills on time influences your credit score positively. And who doesn’t like that?
Don’t Ignore those Credit Card Reports
You read that right! You should be checking your reports once per year, at least. You want to be kept in the loop of your card history – for all the right reasons. Your personal info could be incorrect. You might have “open” loans you’ve long repaid. Or, transactions that you don’t recognize at all could be sitting on your account. Confirming your reports helps unearth potential errors so you can tackle them beforehand.
Craft a Budget and Stick to It
Your credit card is loaded with borrowed money; use it on necessary stuff only. One way to ensure this is by not only creating a budget, but also sticking to it religiously. Take a quick look at your monthly expenses. Take another peek at your income. Do these two agree? If not, it might be time to rethink your spending habits.
Keep Low Credit Card Balances
A balance on your credit card is sometimes inevitable. And that’s totally fine. The question is, how are you handling the entire thing altogether? Here’s how to do it right: Make sure your balance is less than 30% of your credit limit. And, when possible, exceed your monthly payments above the minimum threshold. Also, ensure your monthly payments are on time.
Embrace the Tools at Your Disposal
There are tools you can easily employ to help manage your accounts. And most card issuers and banks offer these, free of charge. Check if you can receive statement notifications via phone or email, for instance. Find out if your account qualifies for free transfers from banks. Check if you can access your account via mobile or online, etc.
Borrow What You’re Able to Repay
Borrowed money needs to be repaid at some point in time. So, only borrow what you’re capable of repaying. You don’t want to be spending a third of your income in paying back debts, including credit card debt.
Over to You!
Hopefully, these tips come in handy when it comes to using your credit card wisely. It all boils down to maintaining a good credit score. You want to be able to borrow money when you need it the most, right?
As the Business Banker for Henry County, Dodie Cason is passionate about serving local businesses. Working directly with business owners and professionals; she is diligent in her desires to find solutions that save time and money, build financial stability and simplify banking processes. You can count on Dodie to serve you with a friendly smile, a compassion for your needs and a commitment to excellence.
AVP, Business Banker • 770-515-7209 • [email protected]