How to Maintain Your Credit Score

By: Justin Martz

It is more important than ever to maintain a good credit score. There are many benefits of having a good credit score. Some of these include the ability to get a loan or credit card, the amount of interest you will pay on a loan or credit product, and how much you can get in credit. It can also impact the ease of getting an apartment or rental, cell phones, utilities, and car insurance rates.

Although there are multiple companies that report credit scores the scale is about the same ranging from 300 – 850. Scores below 669 are fair and poor while scores from 670 – 799 are good and very good. Over 800 is considered excellent. In 2021 the average American score was 716 and the average VantageScore is 695, on the low side of the “good” range.

So with this emphasis on credit score, what are the best ways to maintain it?

First, it’s important to pay your bills on time.

All credit and loans need to be paid consistently and timely. Setting up an automatic payment is a great idea to prevent missing any payments.

Second, say no!

Many stores and services have their own cards and will offer incentives to apply. Don’t apply to numerous credit cards. Its good to have a few good and well-respected cards, with good reward options. But every time you apply for credit it negatively impacts your score and many department store type cards are not great to have. So, choose wisely and don’t apply for every card out there.

Third, don’t max out your credit.

A part of your score is based on your credit utilization ratio, which is the % of over all credit you are using to what you have all together. Its best to stay below 30% of your total available credit.

Fourth, time and history matter.

It may be best to keep some older cards instead of closing them. You can decide not to use them but closing them can sometimes negatively impact your score due to decreasing your credit history and lowering your overall credit availability.

Finally, check your credit regularly.

Most banking apps supply credit scores and you can get copies of your full credit reports in several ways. Ensure you are checking your score throughout the year. And experts say to review your full report at least annually

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The content in this article was prepared by the article’s author. Cetera Advisor Networks, LLC does not endorse its content, and the views expressed may not necessarily reflect those held by Cetera Advisor Networks, LLC.