Being financially responsible has many benefits, like having access low APR offers on auto loans, not having to pre-pay for your utilities, and being approved for a home mortgage. To get there, you need to have a long-term plan that includes credit monitoring and management.
Here are 3 credit tips you need to know NOW:
1 – Check your credit reports
You are legally entitled to one free credit report every 12 months. Review them carefully and dispute incorrect, incomplete and inaccurate information. You can do this by writing a letter to the credit bureau and the party who provided the information.
2 – Prioritize and pay your debts
Did you know that the amount of debt you have is 30% of your credit score? The amount of debt you have compared to your credit limits is called credit utilization. The higher your credit utilization, then the closer you are to your limits and the lower your credit score will be. Also, if you are paying off debt, you are paying interest, and that means you are losing money. Prioritize your debt by interest rate, and pay off those debts with the highest rates.
3 – Create reminders to pay your bills
Your payment history is one of the key factors in determining your credit score. So, pay your bills on time. You can set up reminders in your calendar, and when possible, enroll in automatic payments.