For some consumers, looking up their credit score can cause anxiety, especially for those who have a checkered financial history. While there are plenty of speculations on how it is calculated, it pays to know what can help and hurt your credit score. It often boils down to keeping a tight rein on spending and paying your loans, credit cards, and bills on time. To clear up any confusion, here are some steps you can take to improve it.

Do:

Pay on time.

It goes without saying that paying on time or before the deadline can earn you brownie points. Late payments on credit card and utility bills—even foregone library fines—may lower your score, especially if a collection agency reports them on the credit bureau. If you need an extension, inform your creditor to work something out.   

Spend within your limits.

Credit is good, and using it wisely helps in the long run. A good credit history, combined with moderate utilization, with a long-standing creditor indicates your healthy financial behavior and mindset. Avoid spending more than you can afford or maxing out your credit card limit often.    

Monitor your credit report.

At the very least, request and review your credit reports from authorized bureaus once a year to ensure that you’re not a victim of identity theft or scams. Report discrepancies to fraud assistance centers in removing dubious accounts and transactions that may be weighing your credit score down.

Don’t:

Fall for credit report fixers.

Bear in mind that there’s no such thing as credit report fixers, who can cross out unfavorable transactions from your account. Contrary to false claims, no one is authorized to remove transactions to turn a bad credit score into a good one. You can only achieve a healthy score with positive payment history, time, and behavior.

Share your personal information.

Refrain from giving out credit card information for transactions you don’t remember initiating. Protect yourself against identity theft and phishing scams by shredding bank statements, reading through emails asking for personal information, and reporting lost cards right away. If you suspect your identity is compromised, report the incident.    

Use credit haphazardly.

When you use your credit card for groceries and gas, keep track of your spending and pay them down in full, especially if those expenditures are part of your budget. Be conservative when using your card and refrain from availing of cash advances for your daily living expenses, as it is more costly with added interest.

A healthy credit score opens up a world of financing opportunities for you. When you need credit cards and consumer loans, turn to the advisors at Spirit of America Federal Credit Union. For over 80 years, this trusted credit union has provided quality financial products to consumers throughout Lincoln, NE, and nearby areas. Call (402) 467-1102 or visit the website for more information.