2023 Author: Anita Thornton | [email protected]. Last modified: 2023-05-22 03:30
Having good credit allows you to avoid security deposits, access loans and get better interest rates when buying a home. Here are 10 tips for maintaining a good credit score.
Always pay on time
Utilities like electricity may not be included in your file, but a late payment to your cell phone company could be reported to an agency rating and damage your credit. In addition, delays result in interest charges that are unnecessarily added to your initial invoice. If you tend to forget to pay your bills, use a pre-authorized payment method and your bills will be paid as you go. If you have too many bills to pay at once, ask a few companies to change your payment date. In general, they gladly accept.
Always pay your balance in full
Ideally, you should always pay your bills in full and keep your credit cards zero. If you can't because your balance is already too high, talk to the company to make payment arrangements that will bring you back toa realistic amount to eventually pay your balance in full.
Don't live beyond your means
We mustn't hide it, we live in a consumer society where interesting products follow one another at breakneck speed. By dint of taking advantage of incredible offers and keeping up with our friends' consumption rhythm, we end up spending more than we earn. To avoid doing this, we should all try to keep our monthly debt below 10% of our monthly net income.
Never exceed your credit limits
It is better to increase your credit card limit than to regularly exceed it. Once you apply, try never to exceed 75% of your limit.
Make a budget and stick to it
Budgeting doesn't mean you have to sacrifice all the purchases that make you happy, it's just a way to visualize your obligations and see how much you money left over from your paycheck to please yourself. Your budget will allow you to spend smarter and not be afraid to look at the state of your finances at the end of the month.
Don't hoard credit cards
A filling credit card should be seen as a warning, not a signal that you need a second one! The more you have, the easier it is to slip. Avoidalso cards that carry high interest rates, such as store cards.
Don't transfer your balances unnecessarily
When you are offered a preferential rate credit card, first look at the duration of the offer. If you only have a very small debt that you think you can pay in full before the offer ends, do it. Your debt will be easier to pay off in a year at a rate of 2.1% than at a rate of 10%, that's for sure. Otherwise, don't transfer your balances to an institution you don't know, especially if they make big promises that are hard to believe.
Always have emergency funds for the unexpected
You should always have a little cushion so you don't fall behind on your payments if you lose your job or something else happens. At a minimum, you should have enough money to pay your bills for three months. In an ideal world, but unrealistic for the majority, we should set aside the equivalent of six months' salary.
Notify your creditors when you move
If your creditors don't know that you are moving, they will continue to send you bills at your old address. Make sure you don't have gas or oil bills lying around, charging interest and sapping your credit at your old home, and be sure to talk to all your past suppliers and creditors.
Get credit insurance
Misfortune strikes without warning, it is well known. So that you don't have to worry about the money on top of everything else if something happens to you, take out credit insurance. They are inexpensive and could save you a lot of stress. If, however, you generally pay your balances in full, this insurance is unnecessary.
To ensure you have a good credit report, consider contacting an agency such as Equifax and Trans-Union for ask them for a copy of your credit history. In this report (there is a fee), you will find out what affects your score, your situation in relation to the general consumer, debts that you may have overlooked and that are causing you harm.