You don’t need credit at Aaron’s. (Yay!) Other stores and banks make you have a minimum credit score. (Boo!) We get it. You’re busy. Money is tight. Improving your credit score is the last thing on your mind. That’s why we want to help.
Check out these 3 tips to bring up your credit score and bring down your stress level.
Start Building a Credit History
5 years of credit history is ideal, but maybe you’re just starting out. How can you speed up the process? Find a close friend or family member who always pays their credit card on time. Ask them if you can be an authorized user on their credit card. It takes a little trust!
Or you could wait it out. Don’t open new lines of credit. Just keep the open accounts you have. Maybe even open one credit card for small purchases like gas and pay it off every month. Show ‘em how responsible you are.
Always Pay Your Bills on Time
This is a no-brainer, right? Still, paying bills on time is one of the biggest things that goes into your credit score. Think about it. Would you want to lend money to someone that never paid you back? Banks are the same way.
Even one missed payment can drop your score 100 to 300 points.* Ouch. So make a bill calendar and stay on top of it. And if you think you’re not going to be able to make a payment, call the company. If you give them a heads up and pay a bit late, they’re less likely to contact the dreaded credit agency.
Pay Your Credit Balance in Full Each Month
Want a high credit score? You’ll need a low debt-utilization ratio. That’s the % of your credit that you spend. Here’s some quick math to help you out.
Let’s say your credit card has a limit of $1,000. You spend $750. Your debt-utilization ratio is 75%. You want to try and keep that under 30%. To do that, keep your credit card balance lower OR up your credit limit.
Even if your credit card balance is high, you can still make a difference. Pay it off in small chunks throughout the month instead of paying a big bill at the end of the month. That way it isn’t reported that you have a huge balance before then next bill cycle.
You can do it! Be patient. Pay on time. Follow these tips and your credit score will thank you!