5 Tips to Make Your Credit Score Soar

Your credit score is one of the most important factors in your financial life.  There are lots of benefits to having good credit:  you don’t have creditors calling harassing you for payment, you get approved on the first try, you get good interest rates and terms and you get discounts and notifications about specials.

If you have good credit and a good relationship with your local bank or lender you also have more negotiating power to get the best rates possible. 

Unfortunately, many Americans are still feelings the effects of the recession and have bad credit.  This makes it difficult to get employed and get approved for credit or a loan. 

If you are already in debt, don't have an emergency fund, savings account or retirement account you need to reevaluate your spending habits. Order a copy of your credit report at least once a year from the 3 major credit bureaus: Experian, Equifax, and TransUnion at annualcreditreport.com or call 877-322-8228.

Seventy-five percent of Americans have at least one mistake on their credit report and seventy-percent of Americans have at least one major mistake on their credit report which can lower your credit score. 

While you are working on improving your spending habits you can also follow these 5 tips to help make your credit score soar so when the time is right you can make a purchase and get the best deal possible.

1. Change your mindset. You have to change the way your currently spend money and develop good spending habits so you make good choices when making purchases, buy in terms of needs vs. wants. Spend less than you earn.

2. Get current on late bills. Pay old or late accounts immediately such as collections, tax liens, and judgments. Setup payment plans for late bills that cannot be paid in full.

3. Establish credit. Open a secured account if you have bad credit or no credit to re-establish credit history.

4. Keep balances low. Keep credit card balances at 20% or less of the credit limit. This shows you have good spending habits are not seen as a credit risk.

5. Don't open new accounts. Don't open any new accounts more than once every year when trying to improve your credit score. You will be seen as a credit risk and this will lower your credit score.