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5 Tips to Improve Your Credit Score

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How to improve credit score

Students get grades during school life, while adults get credit scores based on their financial activities.

Sometimes your academic transcripts are not all that important after graduation; however, a financial report card is critical. Your credit score shows how trustworthy you’re and the possibility of honoring your financial obligations.

A credit score is a number between 300 and 850. It’s generated based on your information in the credit report. The higher the number, the more creditworthy you’re, but you’re doomed if it’s low. FICO is the standard credit scoring system in the US. However, there are other companies that compute the scores differently.

How you pay your bills has a huge influence on your credit score, but other factors affect your score too. Here are 5 tips to improve your credit score.

Pay Your Bills on Time

On-time payment is one of the best ways of improving your credit score. Missing deadlines a number of times will hurt your credit scores.

On the other hand, a long history of on-time payments builds you good credit history. So then, pay your credit card and loan repayments on time because providers report late payments that are 30 days and beyond to the credit bureau.

You can avoid this by automating your payments or setting a monthly reminder to avoid overdrawing your bank account. Alternatively, you can contact your credit card issuer if you’re having trouble paying and discuss your hardship instead of failing to submit payments.

Additionally, stay on top of your bills that don’t appear on your credit reports, like subscription services, gym memberships, and more. Although they don’t directly impact your credit score, these accounts can be sent to collections if you fail to make payments on time, which can still affect your scores.

Key Your Balances Low

It’s essential to determine the amount of credit you’re using at any time. This is referred to as the credit utilization rate. Lenders will rate you as high risk when you hit the credit limits because you’re more likely to default.

Therefore keep your credit cards and other debt at a manageable level. You can achieve this by paying your credit card bills in full or as much as possible. Additionally, you can keep the utilization rate under 30%.

Most importantly, understand how credit limits work and stick to them.

Diversify Your Loans

Lenders are happy when you properly manage your different loans. Therefore, it can be helpful to have various loans paid on time, such as credit cards, mortgages, personal loans, auto loans, or student loans.

However, don’t open new credit accounts for the sake of it because this will have a negative if you fail to pay on time. Instead, improve the mix of your loans the next time you borrow money.

Limit How Often You Submit Credit Applications

Getting a new credit card is helpful because it helps you build your credit history. People who regularly open new credit accounts now and then have a higher credit risk than those who limit their applications.

In fact, each application contributes to the hard inquiry, which lowers your score, and this has a compounding effect in the long run. New account applications also decrease your accounts’ average age, which can hurt your scores.

Although new inquiries and the average accounts age are minor factors, it’s essential to be careful about the number of applications you submit.

Don’t Close Your Old Accounts Soon

As mentioned above, the average age of your accounts makes up 15% of your entire credit rating. That means the average age of your newest account and oldest account is a key factor. So then, you should maintain your accounts as long as you’re not charged an annual fee on them.

Further, don’t cancel unused credit cards, department store cards, or random gas cards even if you’re not using them anymore. These cards are proofs that you pay your credit card bills and not a serial card opener and canceler.

Actually, you can put one regular bill on each card and set it to autopay so that you can technically be using the card. It will also help you pay your bills on time and earn good payment points.


A poor credit score can adversely affect your loan application or insurance premiums because lenders can decline your application or charge you higher interest rates. However, you can grow your score by making on-time payments and handling your credit responsibly.

Managing your financial life properly can help you maintain a healthy credit score. You can share with us how you have managed to keep a high credit score by leaving a comment on the comment section of this article.


Kossi Adzo is the editor and author of He is software engineer. Innovation, Businesses and companies are his passion. He filled several patents in IT & Communication technologies. He manages the technical operations at

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