Credit is a significant part of people’s lives nowadays. One’s credit score can have a great impact on many facets of life, like whether they’ll be allowed to take a housing loan or whether or put up their own business. Several[‘loan or whether or put up their own business’ doesn’t make sense.] factors can affect the credit score of a person. Here are some ways to keep credit above the red line.
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| Image source: bbb.org |
Avoid maxing out
When a credit card is maxed out, and the credit card owner exceeds the limit, the system automatically notifies credit authorities. If there is no other choice but to exceed the limit, it is highly recommended that the limit should not exceed 30 percent of the card limit.
Avoid late payments
Paying all the bills on time can keep the credit score from going down. Good ways to ensure this is to have reminders set up, or better yet, program auto-payment systems on smartphones wherein payments are automatically deducted from the bank.
Use card only when necessary
As a rule of thumb, credit cards should not be used to buy one’s bare necessities since extra fees are always added. What does this mean? It means that credit cards should only be used to purchase luxury items – only when the cash isn’t enough. And it means that credit cards should only be used during emergencies.
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| Image source: thepointsguy.com |
