Did you make a goal in 2019 to start building up your credit score? It's important to establish a history of responsible credit practices and build your score by maintaining good habits to help you achieve your future financial plans. Use our tips to help get you started.
- If you are just beginning to establish your credit history, open a checking account and keep careful track of your balance.
- Use debit and credit cards for convenience and safety, but not to overspend. Missed or late payments can damage your credit and hurt your credit score.
- A good mix of credit, such as a revolving credit line and an installment loan, can also boost your credit score. Plus, this shows you can manage different types of credit.
- Demonstrate stability in the three to six months before a major purchase. Avoid opening or closing accounts, or moving large amounts of money around.
- Build an emergency fund equal to at least six months of living expenses. If the unexpected happens, you will still be able to pay fixed expenses instead of falling behind.
- Alter your credit focus as you approach lifecycle stages. As you near retirement, for example, start paying down major purchases (such as a mortgage).
- Monitor your credit regularly so you can correct any errors and detect any potential signs of identity theft.
Use these tips to help you establish good spending and saving habits, and work to stick with them to achieve your financial goals. Be sure to also reach out to your local CorTrust banker if you have any additional questions regarding establishing good credit.