6 Simple Steps That Will Help You Save Your Credit Score

Your credit score is one of the most important numbers in your life.

A good credit score can mean the difference between getting approved for a loan and being denied, or getting a lower interest rate and paying more in interest. A bad credit score can cost you thousands of dollars over the course of your lifetime.

That's why it's so important to protect your credit score and keep it as high as possible. But how do you do that? Here are 6 simple steps that will help you save your credit score:

1. Use a Credit Builder App

If you're looking for ways to improve your credit score, using a credit builder app is a great place to start. Fintech experts at moneylion.com recommend credit builder apps to help you track your spending, make payments on time, and avoid taking on more debt than you can afford. By following these simple steps, you can make a big impact on your credit score and improve your financial health.

A good credit builder app will help you track your spending so that you can see where your money is going each month. This information can be helpful in two ways. First, it can help you identify areas where you may be overspending and need to cut back. Second, it can help you create a budget so that you know how much you can afford to spend each month without damaging your credit score.

One of the biggest factors in your credit score is your payment history. When you use a credit builder app, you can set up reminders to make sure that you always make your payments on time. This will help you avoid late fees and penalties, and it will also show creditors that you're serious about paying your bills on time.

Another factor that affects your credit score is your debt-to-income ratio. This is the percentage of your income that goes towards paying off debts each month. If you have a high debt-to-income ratio, it can damage your credit score. Credit builder apps can help you keep track of your debts and make sure that you're not taking on more debt than you can afford.

2. Check Your Credit Report Regularly

Your credit score is important. It's a number that lenders use to determine whether or not you're a good candidate for a loan. A high credit score means you're a low-risk borrower, which could lead to lower interest rates and better loan terms. A low credit score could make it harder for you to get a loan or credit card, and you may end up paying higher interest rates.

That's why it's important to check your credit report regularly. By law, you're entitled to a free copy of your credit report from each of the three major credit bureaus every 12 months. You can request your reports online, by phone, or through the mail.

Once you have your report, review it carefully to make sure all the information is accurate. If you see anything that's incorrect, disputed the error with the credit bureau.

3. Keep Your Credit Card Balances Low

Your credit utilization ratio is the amount of credit you're using compared to your total credit limit. So, if you have a $1,000 credit limit and you're carrying a balance of $500, your credit utilization ratio is 50%.

Experts recommend keeping your credit utilization ratio below 30%. So, if you're trying to keep your credit score high, it's important to keep your balances low.

4. Don't Close Unused Credit Cards

It may seem counterintuitive, but closing unused credit cards can actually hurt your credit score. That's because closing an account will lower your total available credit, which can increase your credit utilization ratio.

If you don't want to use an unused credit card, just cut it up and throw it away. That way, it won't be tempting to use, but it will still help your credit score.

5. Don't Apply for New Credit Cards

Every time you apply for a new credit card, your credit score takes a small hit. So, if you're trying to keep your score high, it's best to avoid applying for new cards.

If you do need to apply for a new card, try to do so during a period when you know you'll have a higher credit score (like after you've paid down some debt). That way, the impact on your score will be minimized.

6. Use a Credit Monitoring Service

A credit monitoring service can help you stay on top of your credit score by alerting you when there are changes to your report. These services can help you keep tabs on your credit score and report any changes. They can also help you dispute any inaccuracies in your credit report. This way, you can take action to improve your score if there are negative changes. 

By following these simple steps, you can save your credit score and keep it high for years to come. So, don't wait - start taking action today!