Tips for Achieving and Maintaining Good Credit


Tips for Achieving and Maintaining Good CreditWe all start the New Year vowing to do better, with our health, our relationships, and of course, our finances. But how do you even begin to make improvements if your financial situation is far less than ideal? And if you're on the right track, how do you keep it going? Here's what you need to know about building and maintaining good credit.

Do you really need good credit?

It's completely possible to have a healthy financial life without using credit at all. In fact, some financial gurus will tell you to cut up your credit cards and promote credit free living as an ideal. But if you're like most Americans, you've probably already jumped in, for better or worse, and are looking to maintain your good credit or to dig yourself out of a financial hole.

Getting your credit report:

Once a year you can get a free copy of your credit report from one of several national services by going to But you can also keep tabs on your score all year long with sites like or sometimes, through your bank or credit card company. Note: your free credit report will not include your credit score but it will include the information that banks and lenders use to come up with that score. Getting this information is the first step to understanding and improving your credit.

Understanding your credit score:

Credit scores range from 300-850. In general, a score around 700 is considered good. Different companies may use slightly different methods of calculating your credit score two of the most widely used are Vantage and FICO. So if you look at several credit reports, they might not be exactly the same. But they will probably draw on similar information and come to a similar conclusion.

Tips for boosting your credit:

  • Check for accuracy: It's important to follow up with any errors on your credit report. These could include anything from an incorrect personal profile to a delinquent account wrongly attributed to your name. Most online services will explain how to dispute a problem on your report.
  • Make on time payments: Whether you're paying off a student loan, credit card, or medical bill, making on time payments is extremely important. Just a single delinquent account can send your credit score into the red zone. And even though certain accounts, like medical bills, don't normally factor into your credit score, if they get reported to collections it's a different story.
  • Face your creditors: If you can't make the minimum payment on a bill, don't ignore it. Make a phone call, write a letter, apply for financial assistance: do whatever you can to keep your account in good standing. Companies just want to get paid, so they will often be willing to work with you to figure out a plan.
  • Get a secured credit card: If your credit score is really in the tank, one of the best things you can do is get a secured credit card, which basically gives you a do-over on demonstrating your ability to use credit in a responsible way without any risk to the lender. Usually these cards require a deposit of a few hundred dollars which you then borrow against and pay back each month.
  • Don't max out your cards: Just because you have several thousand dollars in credit doesn't mean you should use it. Maxing out your credit card demonstrates that you're living beyond your means. Experts recommend that you use 30 percent of your available credit or less.

Follow these tips to begin building a better financial future in the New Year.

For any insurance related questions, call or contact Executive Insurance & Financial Services today.

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