All About Credit: Build & Boost Credit Score, The Key to Achieving Big Dreams in Life

All About Credit: Build & Boost Credit Score, The Key to Achieving Big Dreams in Life

All About Credit: Build & Boost Credit Score

The Key to Achieving Big Dreams in Life

We all got our big dreams for ourselves and our family. We got our dream house, our dream car, our dream life, and everything!

And the truth is your 6-figure income is not really going to bring you closer to that dream stuff of yours. If you want to make those dreams of your come true you have to have a credit score first!

Because as we all know, you can’t make any big purchases without your credit score.

Your credit score will tell the banks how well you can manage your finances and if you are able to pay off the money that you owe in full and on time. It will also be the basis of your approval for major purchases such as a house, a car, etc.

Credit scores range from 300 being the lowest to 850 being the highest. CREDIT SCORE is the main character of your financial success story but take note of this, you need not just a credit score but a GOOD CREDIT SCORE.

Now, what is a good credit score?

A good credit score could also mean a wide range of financial possibilities. It means you can buy any house that you want or any car that you dream of only when you have a good credit score.

On the other hand, a poor or low credit score can take away lots of opportunities. You may have a hard time buying real estate, or banks will just say no to you.

Now that you understand what is a good credit score, let’s dive into how are you going to boost your credit score!

So how do you boost credit score?

You need a credit card.

One of the easiest ways to boost your credit score is to apply and get a credit card. Many people think that having a credit card is not a money-wise decision.

They think that getting a credit card in order to buy stuff is some sort of financial irresponsibility. But truth be told, a credit card is a life essential.

A credit card allows you to apply for loans, borrow money from a bank to buy your dream stuff, and other financial perks. Just make sure you pay back the money that you borrowed on time and in full!

It’s not really about getting in debt, but it’s about building a better credit score as long as you are careful and responsible. Remember, your on-time credit card payments will be recorded and can boost your credit score!

Your credit history

One of the major factors in calculating your credit score is how long it has been since you have had credit and how was your credit accounts. So, the more credit history that you have, the better your score will be.

Getting a credit card and involving yourself in good financial transactions as early as now will increase your credit score and immensely help you in the future.

The utilization rates

The utilization rate shows how responsible you are in utilizing the credit that is available for you. You need to make sure that your utilization rate is low if you want to build a better credit score.

Maintaining minimal expenses and paying your credit in full and on time is the key. An Excellent utilization rate ranges from 0-9% and you need to keep that in mind.

You can still go beyond 0-9% but take note that banks prefer those who only use a small percentage of their credit.

On-time payments

Paying your bills on-time every month or within the grace period of 25-30 days is very important. Not only will it help you raise credit score, but it can also help you avoid any default and derogatory mark on your credit report which can, of course, totally damage your score.

Total number of credit inquiries

Applying for a new credit card or a loan can also help you boost your credit score. Every time you apply, it is marked as an “inquiry” on your credit report but you should also remember that if you have too many inquiries in a short period of time, it may appear negatively.

Too many inquiries can also lower your score a bit for a couple of months, but it is not something you should worry about a lot.

A mix of different credit cards or loans

Banks prefer it if they see a mix of different credit cards and loans on your report. This will tell the bank think that you are a responsible payer of not just your credit card, but other types of loans as well. Having a mix of different types of credit with good payment history can make your credit score go up!

Is it possible to boost your credit score overnight

It may not be that easy for you to quickly increase credit score or increase it overnight, but by being responsible with your finances, using your credit card wisely as you would if you had cash, making sure that you pay your loan on time can get you far eventually.

Lastly, maintaining or doing this for a few months can really help your credit score get better!

Got more Credit Score questions? We have more of that in this blog! Explore now

Subscribe to My Renter Hero Blog

Get the latest posts delivered right to your inbox

Responsive image

Koi.Credit

Read more posts by this author

Get credit for the payments you're already making.

Get Started Now