Does Your Credit Score Have You Worried?

Does Your Credit Score Have You Worried?

Everyone is worried about their credit score.  The worry can often be about not having an adequate score to qualify for a loan or not having any score whatsoever.  It is a difficult conundrum to be in especially since you hear from all sides that credit cards are bad.  So, should you sign up for a card to boost your score or will that make things worse?

It all depends on your ability to pay back your card each month.  If you are consistent, and you know you are bringing in the income to sustain that card, then by all means, go for it!  However, if you need some time to bring in a revenue stream, and make sure all your ducks are in a row, then hold off.  There is no rush and it is better to air on the side of caution than make a risky leap and regret it.

Your credit score, often referred to as your FICO score, is a number that represents how likely you are to pay back the loan on time.  The higher the score the less risk you are.  The score can range from a low 300 to a perfect 850.  The higher your score the better your rate will be.  However, any late payments made on the card will result in point reduction, and therefore, will increase your rate.

Are you wondering how you can maintain or even improve your dwindling score?   Well, here five handy tips to ensure success with your credit card all while keeping an excellent score:

1.   Find out your credit score!  This is a huge step if you have no idea what that pesky number is.  A great way to find out for free is www.creditsesame.com or www.creditkarma.com.   They offer free credit checks and are       able to tell you quickly where you rank.  This is a must-do if you are unaware of how high or low you are scoring.  How can you improve something if you don’t know where you stand?

2.  Pay your bills on time!  This should be happening whether or not you have knowledge of your score.  Quit spending beyond what you can afford and set a budget!  A great resource is www.mint.com where you are                   able to track your expenditures and see where that leaky boat is. Did you know you that if you have an average credit rating of 707 you can raise your score as much as 20 points?  You just have to pay your bills on                time for one month!   A high score is not unattainable.

3.  Think of limbo and keep your card balances LOW.  If you have to have a balance you should not be maxing it out.  A maxed out card can and most likely will affect your score for the worse.  Maxed out cards can                        even drop your score 70 points!

4.  If you do have cards be sure and manage them wisely.  When you make timely payments and are consistent this tends to have a positive effect on your score.  However, if you have no cards to your name the                               agencies have no way of tracking if you are responsibly handling your money.  They don’t want to trust you and in turn will not want to reward you with a great score.  Get a card, but make sure you manage it well.

5.  Have you ever thought that closing a credit card account would help out your score?  Unfortunately, it can do more harm than good.  Keep your account open even if you don’t use it.  It can have a drastic effect on                 your score and not for the better!

After these tips you should be prepared to face your score square in the face and manage those cards like a guru!  Be responsible, be wise, and be informed!

 

Picture By: EP Technology

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Hannah

I'm a small-town Southern belle living in the big city of San Diego with my new husband. I have an English degree from Ole Miss and I have passion for writing and singing. I love coffee and Starbucks is my addiction. Oh, and I absolutely love my little Schnauzer, Bella, as she is a huge part of our little family. I hope you enjoy reading my blog as much as I enjoy writing the articles. If you're ever in our neck of the woods come stop by....as long as you have coffee in hand.....

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