Your credit score is an important score to make your life simpler. A poor credit score can cause problems and get you into trouble. It can also prevent you from buying that house you want or getting a study loan when you decide to go back to college. The good news is that there are things you can do to improve your credit score. It is always wise to get professional advice, but these steps should get you on the right track.
1. Open a bank account. This might be a bit tricky, but if you do your homework, you will find a bank that will let you open an account. Some banks are willing to allow people with bad credit scores the opportunity to fix it.
2. Get a credit card. Get yourself a secured credit card and use your bank account as collateral. Ask about the fees and benefits of different cards. Choose the one without an application fee and low annual fees.
3. Pay your loans. If you have a personal or study loan, make sure to keep paying the installments on time. Any missed payments will reflect poorly on your credit score. Loans that you repay will always be on your record.
4. Become an authorized user. Ask a friend if you can become an authorized user on their credit card. The card will show on your credit report and improve your score. Make sure that your friend’s bank gives permission and is aware of the arrangement.
5. No prepaid cards. Prepaid debit and credit cards have high fees and interest rates. Try and avoid getting these cards. They might sound like a good idea, but once you start charging to them you will find that the fees are not worth it.
6. Healthy financial habits. You need to develop and foster healthier habits when it comes to your finances. This includes having one or two cards that you mainly use, keep your credit card limit at 30% usage or lower, and never miss a payment.
These steps will get you started on the road to improving your credit score.