Preserve Your Good Credit ScoreThere are benefits to having a great credit score – that’s a given. A good credit score wil...
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Preserve your good credit score

Published on: Mar 4, 2016
Published in: Economy & Finance      Business      

Transcripts - Preserve your good credit score

  • 1. Preserve Your Good Credit ScoreThere are benefits to having a great credit score – that’s a given. A good credit score will allow you to geta lower interest rate on your credit cards and loans, and save money on insurance and security depositson utilities and mobile phones.The more you know about what goes into your credit score, the easier it will be to maintain it. There arefive components to your credit score: payment history, level of debt, credit age, mix of credit and recentcredit.One of the best things you can do in order to preserve your good credit score is to simply pay your billson time – all of them. You should also work to be sure your credit card balances remain low. The higheryour balance, the worse your credit score. Your card balance should be within about 30 percent of yourcredit limit or below. Even if you plan to pay off the balance when the bill comes, it’s still risky to chargemore than 30 percent of the limit.But credit card balances aren’t the only things that affects your credit score. Loan balances and lines ofcredit can also impact your level of debt, and having too much debt can cost you credit score points. Itwill also make it much more difficult to make your monthly payments. Keep your debt lower in order tomaintain a good credit score.You may think closing old credit cards will help your score, but the reality is that losing that credit historywill shorten your average credit age and cause your credit score to drop. Rethink it if you are planning toclose that older card.You will also want to limit the amount of applications you submit for new credit. Every time you apply fornew credit, your score takes a hit. If you have a high credit score, you stand to lose less points if you havea lot of credit inquiries than if you have a low credit score. If you want to keep your good score, lighten upon the credit apps.Perhaps the most important thing you can do for your credit score is to keep an eye on your credit report.You should check it at least once a year, being careful to look for errors and fraudulent entries. Errorscould cost you points, so it’s important to catch them and have them removed quickly. Tips to check and improve your credit score Page 1

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