Good Credit

Maintaining good credit is just as important as getting it in the first place. It can be best compared to weight loss; maintaining that perfect weight is just as important as shedding those pounds. Losing good credit is as easy as a few late payments here and there, or missing one payment altogether.

Once you establish good credit, it is vital for your financial future that you keep it that way. The following are all great tips for keeping your credit score high and your future bright:

1) Pay your bills on time. Making consistent payments is the single most important factor in maintaining your credit score.

2) Don’t overextend yourself. Try to leave as much space between your balance and your credit limit as possible so you have enough credit in case of an emergency.

3) Watch your debt to income ratio. This ratio is defined as your regular monthly bills divided by your gross monthly income. If this number is between 20-30 percent, it’s a good idea to take a hard look at your finances.

4) Keep your open credit accounts to a minimum. There is a fine line between too many credit cards and not enough. Find out what the perfect amount of open credit accounts is for you, and maintain it.

5) Review your credit report regularly for inconsistencies. You’re entitled to a free credit report each year, and there are plenty of online sources that help you learn and understand the contents of this report.

6) Avoid bankruptcy. It is usually considered the most negative aspect of a credit profile.

If you’re looking to maintain your credit score or establish better credit, along with making your payments on time it is important to consider the above pointers which can be used to pave a positive financial future for you and your family.