9 best ways to improve your credit score

Is your credit score in need of a pick-me-up? We have some good and some bad news:

The bad news is that there’s no “quick-fix” when it comes to credit, and nothing happens overnight. The good news is that there are many ways to improve your credit score, and they’re not that difficult to implement.

Here are nine simple yet effective ways to improve your credit score.

#1 Look At Your Credit Report

The best way to start improving your credit score is by getting to know your credit report. Your credit report stores your credit history and accounts for all the credit scoring factors you should concern yourself with. By requesting your credit report, you can learn about your utilization rate, credit mix, missed payments, and more.

Tides Tip: Federal law gives you free access to credit reports from the three major credit bureaus (Equifax, Experian, and TransUnion). Using the government-mandated AnnualCreditReport.com website is the quickest way to get them.

When you know what’s accounted for on your credit report, you’ll better understand what you keep an eye on.

Checking on your credit report might also bring some major red flags to your attention. There might be negative marks on your report that you didn’t even know were there. Things like missed payments, debt collections, or numerous unauthorized hard credit checks can severely impact your credit score. You might have to put out some fires ASAP.

Looking at your credit report for missed opportunities is the fastest way to know what needs to be addressed in your credit building game plan.

#2 Pay Off Your Balances

When your credit score has taken a downturn, do your best to pay off any outstanding balances. Just because you’re paying the monthly minimums and not maxing out your credit cards, that doesn’t mean you’re in the clear.

Your utilization rate measures how much available credit you’ve used; it’s a major factor in calculating your credit score. A high utilization rate makes a wrong impression on potential creditors because it can reflect poor money management. If you keep a high utilization rate, you can start to see a downtick in your credit score.

If this is the case for you, the simplest way to rebuild your credit score is to decrease your utilization. Make more than the minimum payments and lower any high balances. Ultimately, your utilization rate will go down, and you should see an improvement in your score.

#3 Use the Rising Tides Secured Card

Rising Tides offers a secured card through our partner first progress bank. They offer secured credit cards that report more than 5 times a month, this offers the ability to raise your credit score 5 times faster than a normal credit card.

To understand how to build credit with Rising Tides, check out How Does Tides Work?

We have a multitude of credit building tools that can assist you to build your credit passively, while we restore it.

#4 Be Patient

When you look at your credit report, another credit scoring factor you’ll notice is your length of credit history. This might be your weakest credit category if you're a youngster.

Most credit experts concur that seven years of credit use is adequate time to determine a person’s creditworthiness. In this case, you must be patient and let your credit history build up.

Tides tip: Remember that credit length is based on the average age of all your credit accounts, so even if you opened your first credit card seven years ago, your length of history might not reflect that.

#5 Diversify Your Credit Mix

Credit bureaus find you more credit-worthy when you can manage different accounts under different agreements; this is why your credit mix is factored into your credit score. To improve your credit score, you might want to open a new account (under the right circumstances).

If you’ve stuck to one credit card because you never saw the need for another, consider a new account. Instead of getting a loan or opening a new credit card if you don’t need one, sign up for Extra if you want to diversify your credit mix.

#6 Limit New Lines of Credit

Sure, we just pointed out the importance of having a diverse credit mix, but that doesn’t mean running to the bank and opening a new credit line. In most cases, applying for new credit requires a credit check known as a hard inquiry. Although hard inquiries don’t significantly impact your credit score, they can still make a difference.

Aside from incurring a credit check, a new line of credit can also decrease your length of credit history. As previously mentioned, your credit report takes the average age of all your credit accounts. One new account can bring the average age down a few years and hurt your credit score. Maintain a good credit score by staying true to your oldest credit accounts and avoiding the tempting young hot ones.

#7 Set up Automatic Payments

Automatic payments are a great way to pay your bills on time and build your credit. Simply making your payments won’t build your credit, but making your payments on time certainly helps. Automatic payments help you avoid missing a payment (which is the last thing you want to do).

A missed payment can stay on your credit report for over seven years, and if it never gets paid, it can snowball into something worse. 

#8 Create a Budget

A budget will help you manage all aspects of your finances better, including credit. A budget accounts for your income and expenses, which lets you get a better hold of your credit use. 

If you’re looking to pay off your debt or make big purchases that require planning, a budget will help. Instead of risking your credit score by using credit and keeping your utilization high, you can build up your cash in checking and savings accounts until you’re ready to make your purchases. 

When you use debit cards and cash according to your budget, you can avoid debt, interest, and raising your credit utilization rate. Slowly but surely, sticking to your budget will help you use credit more responsibly and improve your credit score.

#9 Speak to a credit counselor

Speaking with a credit counselor for your financial worries is actually very normal. The majority of adult Americans actually have poor credit. The other majority of adult Americans are also unsatisfied with their current gross yearly income. 

Learning how to manage things like debt, negative accounts and other mentally stressful situations. If you wanted to speak to one, you are more than welcome to schedule for a completely free consultation with a credit specialist or finance specialist with Rising Tides

So, until next time our friend! I hope this blog has helped you! :)