Having a healthy credit score can really help you later in life, especially if you’re looking to take out a mortgage or something on finance. Here’s how to keep your credit score on the right track.
Benefits of having a good credit score
With a good credit score you can receive lower interest rates on credit card and loan repayments – this is due to you already having shown the bank that you can make repayments regularly and on time.
You’ll also have a better chance of being approved for a loan or credit card, which is incredibly useful if you are looking to buy a house soon. With this, you’ll be able to negotiate your loan or credit card to an interest rate that suits both you and the bank. Good credit scores receive a far easier approval process when renting houses and apartments, so if you’re not ready to buy yet, a high credit score can still benefit you.
Once you’ve boosted your score, you’ll get approved for higher limits on your credit cards, meaning that you can borrow and spend more. You’ll also receive better rates of insurance for your car and any finance that you might have.
Good credit scores also mean that you can have a phone on contract without needing to pay an upfront security deposit.
Things to do to keep your credit score high
- Pay your bills on time
Paying your bills on time will keep your credit score from declining. If you regularly miss payments or can’t afford to keep up with your utility bills, you’ll end up tarnishing your score. - Keep your credit card balance low where possible
If you can avoid racking up a huge bill on your credit card spending, you’ll be able to keep that credit score nice and high. If you have spent most of your credit card allowance, this will reflect on your credit score – however, as you make the repayments and close off bills on this card your score will begin to bounce back.
- Manage your debts
Having too much debt withstanding can also reduce those points on your credit score. The lower the debt that you have, the easier it will be to keep your score looking good.
Try paying off any outstanding debts that you can afford to without putting yourself under too much financial pressure.
- Keep an eye on your credit report
The easiest way to improve your credit score is to keep an eye on what’s happening with it. A lot of credit report apps and companies will offer tips and tricks for how to improve your score. These could be simple things, like making sure you’re on the electoral register and ensuring your address is correct.
There are still options for you if you have poor credit
If you’ve read all of this and are still worried about your score, don’t worry. There are still options out there for you if you have a poor credit score.
Matthew Sanders, CEO of Suits Me, says “We decided to create an alternative banking solution for thousands of people in the UK, from those who are financially excluded from the mainstream by poor credit, to those coming to work in the UK who do not satisfy High Street Banks Customer criteria and those who simply want a modern straightforward and honest solution.”
This fight against financial exclusion can be relieving for most who are in this situation.
