How to Maintain a Credit Score

Getting a good credit score is tricky enough, but maintaining it is arguably harder. Having a good credit score doesn’t mean that you’ll keep a good credit score, so it’s important that you take the steps to maintain it. A good credit score means that you’ll be more likely to get accepted for credit in the future when it comes to renting or buying a home and applying for loans, credit cards and store cards. An excellent credit score could also minimize the interest that you have to pay on credit, so it’s definitely worth building your score. Once you get there, follow the steps below to maintain your credit score and your credit rating.

 

Pay Your Bills

Paying your bills on time is imperative to maintaining a good credit score, and that goes for all of your bills, not just your credit cards and loans. Missing a payment, or making a late payment on any of your bills, such as insurance or your gas and electricity bills will show up on your credit report, lowering your score. Pay all of your bills on time to maintain your score. If you’re forgetful, set up automated payments so that you never miss a payment.

 

Pay Off Debt

A good credit score means that you’ll be eligible for higher levels of credit – but the more credit you take advantage of, the more debts you’ll have and your score will plummet. Pay off your debt, if you have it, and try not to get into too much debt. The credit might be available but it doesn’t mean that you have to have it! Loans and credit accounts account for 30% of your credit score, and the more loans and credit accounts you have, the lower your score will be.

 

Keep Credit Low

Having no credit can be as damaging to your credit report than having too much credit. You need to strike the right balance and show that you can have credit without having to spend too much and that you can pay it off. Generally, it’s a good idea to keep your credit spend to less than 30% of your credit allowance. That means, if you have a credit card with a $1000 balance, you should ideally keep your spend to less than $300. This shows that you can use credit without going over the top with it, and it also demonstrates that you use credit regularly – and this will help to maintain your score.

 

Be Wary of New Credit

Multiple credit applications could have a massive impact on your credit score, so be wary of applying for new credit too frequently. Credit inquiries equal around 10% of your overall score, and too many of them could drop your excellent credit score to a good credit score. Equally, having too many open credit accounts or opening too many credit accounts at the same time will lower your score, so open new credit sparingly and be wary of new credit offers.

 

Maintaining your credit score is very important, so follow the tips above to keep your score high.