Improve Your Credit Score With These Simple Steps

The process can take several months or even years, but certain actions can generate quick results. (iStock)

Your credit rating is actually a newsletter on how you manage your debt. The higher it is, the better your chances of obtaining credit when you need it and on favorable terms.

If you’re new to credit, or have taken a few missteps in the past, it may take a while to get to where you want to be. But taking action now to improve your credit score can produce quick results.

Why is it if my credit rating is low?

Life is complicated, and it’s not always easy to stay on top finances. But maintaining a good credit history should be your top financial priority. Not only will a bad or fair credit score make it difficult to approve a loan or credit card, but it can also make you pay higher interest rates.


There are several ways to increase your credit score. (iStock)

Plus, your credit history is often used for more than just loan and credit card approvals. While landlords and employers can’t actually see your credit score, for example, they might choose to perform a credit check when you apply for a lease or a job. If there is something wrong that could negatively impact your credit score, you could be turned down.

In addition, in many states the automobile and owners insurance companies use what are called credit-based insurance scores to determine your premiums. While a bad credit rating alone won’t cause rates to rise, it could help if there are other reasons to view you as a risk as well.

Steps You Can Take To Improve Your Credit Score

If you are looking to increase or improve your credit score, here are some concrete steps you can take:

  • Pay your bills on time: Your payment history is the most important factor in your FICO credit score. If you are in arrears with one or more accounts, catch up as quickly as possible and plan to pay your bills on time in the future. “One of the best and easiest ways to get credit is to open a credit card,” says Mike Pearson, founder of Credit Takeoff. “It puts you on the credit card because it prompts creditors to start reporting your payment history.”
  • Keep your credit card balance low: Your credit usage rate – how much of your credit is available on the credit cards you use – is another important part of your FICO score. Credit experts recommend keeping your balances below 30% of your credit limits, but the lower the better.
  • Be added as an authorized user: If you have a trusted family member with a strong credit history, you may be able to benefit from this. “Ask a parent with a good credit history to add you as an authorized user on one of their credit cards,” says Pearson. “It gives you a chance to start building a credit history without having to make payments.” Arrangement can help substantiate your score as soon as it is calculated with the new information.
  • Check for credit report errors: Check your credit reports through for anything that could be incorrect or fraudulent. If you see something that doesn’t belong to you, you can file a dispute with the credit bureaus to have it removed. If you need help, credit repair companies can help you resolve credit score issues resulting from incorrect credit report data. Once the incorrect information is removed, you can see your score rebound quickly.

With some programs, including Experian Boost and UltraFICO, you can also improve your credit score with utility payments and the way you manage your money. But for now, these may have less of an impact on the actual credit scores used by lenders.


“When you’re starting from scratch, building your credit can seem like a chore,” says Pearson. “But persistence definitely pays off, and building a good credit history may not take as long as you expect if you’re determined to work hard at it.”

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