Watching Your Wallet: Improving your credit score

Watching Your Wallet: Improving your credit score
Published: Jun. 1, 2022 at 5:59 PM EDT
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LANSING, Mich. (WILX) - Your credit score dictates much of your financial future and if you’re looking to make a big purchase, you need to have it in good shape.

Your FICO score constantly changes with your credit activity. It reflects your buying and spending patterns. It could take a few months to fix your score -- especially if you’re trying to improve it by 100 points or more.

Cherry Dale, a financial coach with the Virginia Credit Union, said the number one thing you can do to help your score is to pay your bills on time.

“This is the most weighted when it comes to your credit score,” Dale said. “35% of your credit FICO score is based upon online payments, so make sure you at least pay the minimum on those payments.”

She said it’s best to pay more than the minimum, because if you pay only the minimum, you’ll be paying more in interest. Dale also said you shouldn’t over-borrow.

“For example, if you can borrow $1,000 on a credit card, you want to really keep your borrowing to around $300 dollars,” Dale said. “30% is a good rule of thumb when it comes to what you should be borrowing off of your credit line.”

If you’re maxing out your credit card, that’s a risk factor that will bring your score down.

Also, keep your accounts open. The length of your credit history makes up 15% of your FICO score. Accounts that you’ve had for more than two years will have a more positive impact on your score than newer accounts.

More: Watching Your Wallet

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