Your credit scores determine a lot more than the loans you can get and the interest rates you pay.
- Insurers use credit scores to set premiums for auto and homeowners coverage
- Landlords use them to decide who gets to rent their apartments
- Credit scores determine who gets the best cell phone plans and who has to make bigger deposits to get utilities
Your credit score can work for you or against you! You can build, defend and take advantage of great credit regardless of your age or income.
Good credit habits include:
Paying your bills on time is crucial to growing your scores. Nothing counts more.
Light but regular use of your credit accounts is also important. Know your credit limit on each card and charge no more than 30 percent of that limit.
- Pay balances in full. There’s no need to carry debt when your goal is growing your scores. If you do carry balances, try to pay them down as quickly as possible.
- Avoid closing accounts if you’re trying to improve your credit. Once your scores are high — over 760 or so — you can shutter an account or two without major damage, but try to keep your highest-limit credit cards open.
- Monitor your credit regularly and maintain personal security against identity theft
What is a good credit score?
There are different credit bureaus, and some have multiple ways of scoring credit histories, but in general, scores range from about 300 to 850. A "good" credit score could be considered 670 or higher, but that's a rough rule of thumb.
How do I check my credit score?
You are entitled by law to a free credit report from each of the major credit bureaus once per year. You can request these reports at AnnualCreditReport.com. There are also several credit monitoring apps and services, some of which are free, that allow you to track your credit throughout the year.
The three primary credit reporting agencies are: