So you’ve got your credit score for free by signing up for one of MyFico of Equifax or packets of TransUnion. With economic difficulties around us, the credit reporting agencies raise levels of what is considered a perfect credit score. Therefore, you want to increase your credit score for free at that time, or beyond. How are you doing in an economic downturn? Here are some tips:
Pay credit card balances each month
The less you have to pay interest on your credit cards, the better. Avoid wearing your credit balance to the following month by paying in full by the due date. The credit card companies may increase your interest rate too if you just pay the minimum, the charge on your card too, or max it out. If you can not afford to pay in full, pay more than the minimum – as much as you can afford. Regularly check your credit score for free to see how your payments will affect your score.
Planning is important
To avoid overspending, plan your purchases and do not buy everything at once, especially expensive items. Shop months apart, and make sure that you will be able to pay for them. The key is to have little debt as possible at all times. You’ll find that judicious spending will improve your ALL Three Credit Scoresfor free.
Maintain an emergency fund
Set aside a fixed amount of your salary every month and deposit in the interest of winning account. Set up an automatic transfer so that the money is immediately deducted from your paycheck before you try to spend it. Throw in tax refunds, dividends, or any extra money you have.
This will be your “last resort” source of money, to be used for large medical bills if you lose your job, or to deal with the unexpected such as a major car breakdown.
Saving is difficult when you are paying by credit card and other debts, but eventually it will become a habit and a mindset. The amount of money you have in your accounts does not affect your credit score for free, but the fund will be a boon if you ever come across unforeseen emergencies.