The Best Ways to Increase a Credit Score

You hold the cards to your financial future.
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Some people do not think about their credit score until a problem arises or they want to apply for a loan and get the best terms. Whether or not you plan a major financial leap, you should have a rough idea of your credit score and the actions you can take immediately and in the long term to improve it.

Fix Errors

Some credit score problems arise from errors on your credit report. The Federal Trade Commission's guide, "Building a Better Credit Report," explains that you have the right to see the information in your credit report and to know every institution that has requested a copy of your report within the past year. Analyze your identification information, your employment history, your payment history, creditor inquiries and public record information for accuracy. Write your credit report company regarding any inaccurate information and follow up to make sure the updated information appears on your credit report.

Improve Payment Schedule

Your history of bill payments figures prominently in your credit score. The MyFico website's guide to improving your credit score includes basic advice, such as paying all your bills on time. However, you should also fix any problems with old debt, unpaid bills or missed payments to ensure your payment records are clear. If a debt goes into collection and you pay it off, it remains on your credit report, affecting your credit score, for seven years.

Enroll in Credit Counseling

While signing up for credit counseling does not automatically raise your credit score, your counselor can help you develop strategies to manage or consolidate debt and control your finances so that your score eventually improves. The Federal Trade Commission warns that many companies that offer credit counseling do not have affordable services offered by accredited counselors. To locate a reputable credit counseling organization, look for services offered through a university, credit union, military base, housing authority or branch of the U.S. Cooperative Extension Service.

Managing Debt

Financial guru Suze Orman has written many guides on how to manage debt. One of her key recommendations for raising your credit score involves balancing your ratio of debt to available credit. Do not charge to the limit or close to the limit on your credit card. If you have several cards, you can rotate the one that incurs debt, or use a different line of credit while paying down any cards close to your credit limit.

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