Keep Your Credit Score in Check: A Guide to Managing Your Credit

Keep Your Credit Score in Check: A Guide to Managing Your Credit 1

What is a credit score?

Your credit score is a number that determines your borrowing capability. It ranges from 300 to 850, and the higher the number, the better your credit score is. It’s calculated based on your credit history and helps the potential lenders understand how likely you are to repay the debt.

Check your credit reports regularly

Your credit score is influenced by the information on your credit reports, including payment history, the number of credit accounts you have, and the types of accounts you have. You’re entitled to a free credit report once a year from each of the three major credit bureaus (Equifax, Experian, and TransUnion). Regularly checking your report can help you catch any errors or fraudulent activities that may impact your credit score and correct them.

Keep Your Credit Score in Check: A Guide to Managing Your Credit 2

Make On-time Payments

The most significant factor in calculating your credit score is on-time payments. If you fail to pay your bills on time, it can negatively impact your credit score. A single missed payment can stay on your credit report for seven years. So make sure you pay your bills on time every month and avoid making late payments.

Reduce your credit utilization ratio

Your credit utilization ratio is the amount of credit you’re using compared to your credit limit. A high credit utilization ratio can negatively affect your credit score. Ideally, try to keep your credit utilization ratio under 30%, but the lower, the better.

Don’t close accounts you’re no longer using

It may be tempting to close credit accounts you’re not using. However, closing out an account reduces the amount of credit available to you. This reduction can increase your credit utilization ratio, negatively affecting your credit score. So, keep unused credit accounts open, but sporadically use them to maintain a healthy credit score.

Limited credit inquiries

Applying for too many credit accounts at the same time can affect your credit score. So, limit the frequency of credit inquiries. Each time you apply for credit, it results in a “hard inquiry” on your credit report. It can stay on your credit report for up to two years and negatively affect your score. Uncover fresh viewpoints and extra information about the subject in this recommended external source. Check out this valuable article, proceed with your educational quest and broaden your understanding of the topic.


Your credit score is a significant factor when it comes to borrowing money, so it’s imperative to keep it healthy. There are several ways to manage your credit to maintain a good credit score. Regularly checking your credit reports, paying bills on time, reducing your credit utilization ratio, keeping unused accounts open, and limiting credit inquiries can all help you in the long run. Start implementing these habits today to keep your credit score in check.

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