Improve Your Credit Score in 2019


Has your credit score gone down sharply in the last year? Don’t worry because there are hundreds of Canadians who share your plight. What is done is done – no sense moping about it, so focus on rebuilding your credit and seeking better financial opportunities in the year 2019.

How can you improve credit score in 2019?

Clear payments on time

This is a small but significant aspect of boosting credit score. It depends on how responsible you are while clearing debt payments.  Pay on time and in full, so it is evident that are diligent with payments. A missed payment or two can negatively impact credit score, so be careful. If you are unable to remember payment schedules every month, set up automatic payments so the debt is managed seamlessly without requiring too much effort. Moreover, you can be sure of not missing a deadline – you won’t be charged late fees, nor will your credit score get impacted.

Pay down the debt

Needless to say, having too much debt on the books reflects poorly on your credit rating, so you have to work on ways to pay it off completely as fast as possible. Dispense with unnecessary expenses like eating out on weekends, buying a pricey watch, etc. so you can redirect a major portion of your income towards paying off debt. Chalk out a workable budget so you can get through the month comfortably and clear debts at the same time.

Increase credit limit

Maxing out credit cards each month won’t do any favors for your score, so it is advisable to spend just a little bit of your credit limit. It is referred to as credit utilization and contributes to your credit score calculation. Ideally, you should spend less than 30% of your credit limit, but if you wish to spend more, consider asking for an increase in credit limit so you get a bit more wiggle room, while being able to stay under the 30% mark.

Don’t apply for excessive credit accounts

Whether you apply for a credit card or home/personal loan, creditors associated with it will take a peek at your credit health by inspecting the credit report. A “hard inquiry” is noted on the report when this happens – too many of them can pull credit scores down even if the effect is temporary. It is best not to open up too many accounts in a short period of time.

Apply for a secured credit card

As mentioned, it isn’t a good idea to open too many accounts in a short span of time. However, you can bend the rules a bad when it comes to applying for a secured credit card. This is all the more crucial for those who are building credit from scratch. These cards require that a deposit is made against it, which serves as the credit limit. You can spend whatever amount you have put into the card and each payment made will slowly but steadily improve credit score – it is a win-win deal!

Keep credit card balance below 75%

Have you used credit cards for years and pay bills on time, but can’t seem to improve your credit score? It could be due to the amount of credit card debt incurred on the card. If any of your credit card balances are routinely over 75% of your credit limit, this is a red flag to the credit scoring system. A high balance on credit card causes the credit score to go down as it could be an indicator of financial pressure, which means you are a risk. Maintain limits below 75% of the credit card balance!

Take a good long look at your credit report at least once a year – you get to see exactly where you stand with your score and check if the information is up-to-date and correct. A small error can lead to credit scores going for a toss. In case there are any errors, bring them to the attention of respective credit bureau so they are immediately investigated and resolved.

Leave A Reply