4.5.4 Improve your credit score

If you have had a low credit score in the past, you can improve it by using credit more carefully. Eventually your score will improve, and it will be easier for you to get credit.

Here are some tips for improving your credit score:

• Pay your bills in full and on time. At least pay the minimum amount shown on your statement. Set up automatic payments to ensure that your bills are paid on time.
• Don't go over the limit on your credit card. Keep your balance low—below 35 percent of your credit limit if you can. The higher your balance, the more it affects your credit score.
• Don't apply for credit too often. Too many lenders asking about your credit in a short period of time can lower your credit score.
• Pay off your debts as quickly as possible.
• Build a strong credit history. You may have a low score simply because you don't have a long credit record. You can improve your score by using a credit card—and paying it off on time every month.
• Check your credit report about six months in advance if you plan to make a major purchase that will require you to take out a loan, like buying a house or a car. This will give you time to correct any possible errors and improve your score.