Your credit score has never been so important. Now days, your credit score not only matters if you want to buy a house or a car, but, often times, even if you are trying to land a job! Lowering your score may seem like a daunting challenge, but it doesn’t have to be if you stay organized, come up with a strategy, and stick to that game plan. Here are three simple ways to get you on the right track.
1.It’s what you know
The first step that anyone should take is obtaining their credit report. Annualcreditreport.com allows you to view your credit your score once a year for free. Notice that this is a credit report, not a credit score service. This service will allow you to see a full breakdown of all your credit accounts and history. This report should give you a good idea of how your credit stands without an actual number. If you do want specific numbers, there are a myriad of sources that you can use. Always do your research, as not all services are the same. Find a service that has known for its quality, reputation, and fair price, as there are plenty of websites that have less than shining reputations. Once you have begun staying on top of your finances, continue to do so. The digital age has made this an easy task. Check your bank and credit card statements frequently and take advantage of alerts, which can inform you when you are down to a certain amount in your respective accounts. Automatic payments are also a wonderful way to ensure that you are not delinquent in any of your payments. These can be set for anything from credit cards to electric bills in most places
2.Make that game plan
Making a budget sounds like an obvious task that should go without saying, but, in reality, many people simply do not sit down and make a proper one out. The key is to take your time to make a realistic and beneficial budget. If possible, use a spreadsheet on your computer, but writing one out can also be effective. Look over several months of statements and allot specific amounts to specific expenses. Once you form out a comprehensive budget, it is vital that you look at it every day and input your expenses for each month. If you are diligent and see what you are spending compared to what you have budgeted every day, you are exponentially more likely to stick your budget. Be strict and disciplined, and don’t make excuses!
After setting a budget, come up with a plan to pay off your debt. Allot as much money as you can to tackle the problem, and do not fall into the same traps that got you into credit trouble! That means using your debit card instead of your credit card. Using a credit card can be habit forming, but a critical key to helping your credit is to break this habit. Now, you will want to look at your credit report and other statements to figure out which debts are hurting you the most. Come up with a plan and take an aggressive approach to paying off your highest interest rate items. Knocking these items out is critical, and once you start seeing your progress, it’s hard not to get swept away by the momentum and the relief.