5 Tips To Improve your Credit Score

Your Credit Score is one of the most important things in your life that can influence the quality of your living standards. Ironically enough, it is trying to achieve a high level of living standards artificially that can easily lead to having a low credit score. This is because it is so easy to borrow credit and to live on your credit cards in order to afford that lounge suite or that plasma TV or the IPhone or any of the other expensive gadgets that you think you cannot live without. Soon you find yourself in a situation where you need to start repaying all those credit cards and very soon you find yourself in a situation where not only you have to repay the credit, but your credit score is low due to missing essential payments AND the sheriff might have taken all your worldly goods as well.

Isn’t this just the worst scenario to be in? A low credit score means that you are going to find it very difficult to get credit again at good rates, you don’t have all your goodies any more AND you are struggling with repayments at the same time.

It is then that you start to realise how important it is to have a good credit score.

You have managed to get yourself into the mess, now you need to get yourself out of it!

Here are 5 tips to increase credit score:

1. Pay off all revolving credit cards. Even though you might pay before the deadline, the debt owed on a monthly basis still count towards your overall indebtedness and will decrease your score. If you have more than one of these credit cards, pay the minimum on both and then aim to get one of them paid off first, then the other.

2. Registered Income. This is your official income. If your debt is more than what you earn, your credit score is lowered. See if you can get a part time job to increase your income. This will help with paying off your credit cards as well, if you have any.

3. Measure and track. Check your credit score to see where you are at. This will give you a good idea on whether you need to improve it and how high or how low it is. Until you have done this you are basically shooting in the dark in any case.

4. Do try and apply some financial discipline. Yes, it is difficult, and it is what made you get into this mess in the first place. The problem is that if you apply for too much credit at this point, you will be credit checked every time that you apply, and every time that you are checked this appears on your credit record and could lower your score even further if these checks happen too close to each other.

5. Paying debt – make prompt bill payments. Pay your bills on time. If you find that you are running in to a problem with payments, communicate with your creditors BEFORE the problem arises. Tell them that you are having some problems in a particular month but that you will make a specific arrangement with them to catch up your payments – then stick with your arrangements!

If you follow these 5 tips, your will find that it is easy to raise credit score as well as easy to maintain it – if you have the self discipline and the long term vision that good credit score can open doors for you.