It sounds kind of crazy, but one of the best ways to prove you are credit worthy is actually using a credit card! Of course, you have to use it responsibly. 😉 Your first step when raising your credit score should be wiping out your card balance slowly but surely. Increasing your debt to credit ratio and paying on time will all help you in your quest to up that all important number!
So why should we all worry about raising our credit scores? Let’s take a look:
1. Future Loans
If you need money in the future in the form of loans, you’ll need a good credit rating. Your rating shows how reliable you are with borrowing money, and your past credit history is considered a strong indicator for how reliable you will be in the future.
I know there are tons and tons of top tips for improving your credit rating but in actuality using a credit card responsibly is one of the best. Not only is it a flexible option, but it’s manageable too as long as you only borrow what you need and pay it off on time every month.
2. More Competitive Rates
Even if you can get a loan now, improving your credit score can actually get you better rates! And, if you can’t get a credit card due to a poor credit history, there are actually a ton of options. In the US, you can use pre-paid cards to build credit. Abroad, you can work with companies like Aquacard who are known for working hard to help you improve your credit rating. You might start out with an interest rate at around 32% APR, but if you pay on time and in full every month, they will actually drop your interest rate by up to 5% every year. It’s a great way to prove you’re ready to handle owning a credit card again. Of course, if you want to find out more about aquacard or any other lender in your area, it’s really important to visit their website, read through the fine print, and search for any testimonials just to make sure its right for you.
Ultimately, with just a few positive changes to your spending patterns including paying your credit cards on time every time, you will be well on your way to improving your credit score and enjoying some of the benefits that come with having a high credit rating.
What are some other ways people can improve their credit score?