Increasing your credit score does not have to be a difficult exercise. There are some simple steps that you can take to improve your credit score automatically without having to make much effort. Here are 3 simple, effective ways to increase your credit score:
1. Pay Your Bills Automatically
In a society where we have busier and busier lives, it may become difficult to stay on top of all your bills while juggling other pressing issues. A missed payment here and a late payment there, can be detrimental to your credit score. However, it doesn’t have to be this way. Most banks offer the opportunity for you to set up automatic bill payments. Once this is established, the bank will automatically make all your bill payments such as utilities, credit card debts, motor vehicle insurance etc. on their due dates without you having to do anything further. This is a simple way to improve your credit.
2. Put a 30% Cap on Credit Card Debt
Your credit score will receive a boost if you keep your outstanding balance to no more than 30% of your credit limit. This means that if your credit limit is $1,000, you should aim to keep your balance below $300 each payment period. If you go beyond the 30% mark, it will negatively impact your credit score.
3. Limit the Number of Hard Credit Queries
The number of hard queries made on your credit could potentially lower your credit score. Avoid this by limiting your applications for credit to only a few. Thankfully, making several mortgage or auto loan queries in a short time period, count as only one query on your FICO report. However, if you have only a short credit history, or only a few credit accounts, the impact on your credit score could be great.