How to Protect Your Credit Score

What Does Credit Mean to You?

Do you know whether you have good credit, OK credit, bad credit, or no credit at all? Your credit score is a number anywhere from 830 (great) to 330 (very poor). The average American credit score is around 678. The best thing you can do as a consumer is build good credit (trust) between yourself (the borrower) and your lenders. It can mean the difference between being able to finance a home to being able to climb your way out of a financial rut.

Find out how to build and protect your credit.

What is My Credit Score?

Do you know your credit score?

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What Factors Determine Your Credit Score

Find out which factors positively or negatively impact your credit score

From the moment you are 18 and can legally have bills and credit cards in your name in the United States, you are responsible for building and protecting your credit score.

Which factors actually impact your credit score?

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To build a well-rounded, healthy "credit portfolio", establish the following:

Have bills in your name (i.e. utility bills, cell phone contract). This will help you establish credit. Pay these on time every month.

Have at least one low-interest credit card in your name. Pay at least the minimum payment on time every month.

Do not apply for every credit offer. Everytime there is an inquiry to your credit report, you lose points. Only apply for credit offers you really need.

Do not max out your credit cards. Leave a low balance every month to improve your credit score.

How to Raise Your Credit Score

What can you do to positively impact your credit score?

Ways to Earn Credit Points

Pay all bills on time every month. Never miss a bill or credit card payment. Always pay dues on time.

Maintain a healthy balance ratio. Paying your credit cards down to zero every month is the best way to stay out of debt, but does not actually help your credit score. It's better to maintain an overall credit balance of around 20%-30%, which will earn you points every month.

Do not cancel unused credit cards. If you have decided to stop using a credit card, simply shred the card without closing the account. Closing credit accounts actually negatively impacts your credit score.