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Boost Your Credit Score: 5 Tips

A piggy bank attached to a rocket, representing a rising credit score.

Looking to boost your credit score? Credit scores can seem mysterious and overwhelming, but they don’t have to be. It’s easy to learn the basics and get on the road to financial empowerment! 

It’s never too late to focus on improving your score. Even if you’ve faced significant credit challenges in recent times, your score has nowhere to go but up! We’ve got some stellar tips that can help your credit score rocket into the stratosphere!

Boost Your Credit Score: How Credit Scores Work

Your credit score, also known as a FICO score, is a 3-digit number between 300 and 850. The higher the number, the better your credit is. Most lenders consider anything over 670 or so to be a good score. Your credit score does not take your income or assets into account—it only measures how well you manage the credit you’re extended. 

The first credit score to be used in America was introduced in 1989 by FICO, a data analytics company. Before credit scores were invented, the decision to extend credit was much more subjective and based on reputation and personal relationships between the lender and prospective borrowers. The FICO score, which is still the most common credit scoring model used today, claims to provide a more objective and impartial method of gauging creditworthiness and risk for each customer.

There are three credit bureaus: Experian, Equifax, and TransUnion. Not all creditors report information to all three bureaus. This means your credit score may differ depending on the bureau, but they’re generally close unless there are major discrepancies in information.

While FICO doesn’t publish the precise credit score formula, they determine your score based on the criteria outlined below.

Payment History

The largest factor in your credit score is, of course, your credit history. Making payments on time improves your score. Making payments late—or failing to make them at all—lowers your score. The farther behind you are on your payments, the more they count against you. 

The good news is that your recent history counts more than late payments made long ago. This is a tremendous opportunity for you to improve your score! Even if you have a rocky payment history in your past, you can immediately begin improving your score by making payments on time going forward.

Debt-To-Credit Ratio

The second-largest factor in your credit score is your debt-to-credit ratio. You calculate this by taking your total amount of debt and dividing it by the sum of your credit limits. The lower this ratio is, the better; most experts recommend using 30% or less of your available credit to avoid a significant negative impact on your score. 

Let’s say a consumer has three credit cards, as listed below:

BalanceCredit LimitAvailable Credit
Card A$1000$5000$4000
Card B$4000$10000$6000
Card C$5000$10000$5000

A credit score looks at all of the consumer’s credit card accounts and calculates the percentage of their credit limits in use. This person has $10000 in credit card debt. The credit scoring model divides that by their combined credit limits of $25000, giving them a 40% debt-to-credit ratio.

Length of Credit History

The average age of your credit accounts also plays a role. A longer history of using credit, measured by the age of your credit accounts, is a boost to your credit score. 

New Credit Lines Opened Recently

In general, it’s best to avoid applying for too many credit lines at once. Lenders consider a sudden spate of new credit accounts to indicate financial risk, so your credit score will drop if you open several new accounts in a short time. 

Diverse Loan Portfolio

Having a mix of several loan types can help improve a credit score. All other factors being equal, someone who has a mortgage, a car loan, and a credit card account will have a better credit score than someone with three credit card accounts but no other types of credit. 

Understanding these criteria is key to improving and maintaining your credit score. However, if your payment history or debt-to-credit ratio is in rough shape, don’t despair! We’ve got some tips to help you get your credit moving in the right direction. 

5 Tips To Boost Your Credit Score

Boost Your Credit Score: Make Automatic Payments

The most effective way to improve your credit score is to make payments on time. Fortunately, most credit cards and loans offer automatic payment options, which can be a lifesaver for busy consumers. You can always make an extra payment if you’re trying to pay debt down, but setting up an automatic payment for at least the minimum amount due is often the best thing you can do to improve or maintain your score. 

If you’re worried about whether the payment date will work with your budget and cash flow, call your credit card company or check their app. Many lenders allow you to select the date of your choice each month for your payment to be debited, so you gain the benefits of automatic payments without messing up your budget. 

Boost Your Credit Score: Make Automatic PaymentsCheck Your Credit Reports and Monitor Your Credit

Federal law entitles you to receive a free credit report every 12 months from each of the 3 major credit bureaus, simply by visiting While these free reports don’t include your score, reviewing them gives you the opportunity to ensure the information the bureaus are using is accurate. If you see items on your report that shouldn’t be there due to identity theft or error, you can dispute them in writing. The bureau has 30 days to confirm the validity of the item or remove it. 

Signing up for a credit monitoring service is also a smart move. Apps such as CreditSesame allow you to monitor your credit reports, providing another layer of protection from identity theft. Many credit card companies also have a service to track your credit score. 

Ask For Credit Limit Increases

It takes time to pay debt down, but increasing your available credit can also improve your debt-to-credit ratio. Often, you can increase your credit card limit with a simple phone call to customer service. Remember, though, this strategy only works if you don’t use the additional credit. It’s also a smart idea, as you pay down debt, to leave accounts open and only use them for ongoing monthly purchases, then pay them in full each month, 

Get Credit for Your Bills

Services like Experian Boost allow you to get credit for paying bills that otherwise wouldn’t affect your credit score, like utilities or streaming services. These may not provide a huge score increase, but it can make a difference for consumers with limited credit histories.

Diversify Your Credit Mix

Using different types of credit can boost your credit score, so it pays to be an informed consumer and use the right loan for a situation. Opening up a credit card account with a rewards program can earn cash back or travel rewards even if you pay it off every month. Taking out a personal loan to pay a credit card balance can give you a set payment schedule and fixed interest rate. A home equity loan can be a great option for home improvements or repairs. Utilizing different loan products means you can use the most efficient type of loan for your circumstances and improve your credit score at the same time.

Boost Your Credit Score: Begin Building Better Credit…Today!

With our tips on boosting your credit score and your new knowledge on how your score works, there’s no day like today to begin working on your credit score. Making credit work for you is an important part of achieving financial empowerment— time to make your credit score skyrocket!

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