What a difference a year makes. Last year at this time, we were looking forward to a 2020 filled with new opportunities and hope. Then Covid-19 came knocking. 12 months later, 2021 is looking very different, with many of us dealing with a range of financial, work and health stresses that we never could have imagined.
We know how to protect our health against the virus. Now we need to do the same with our finances – and one of the best ways of doing that is making sure we have a good credit rating, and managing our finances better.
So how do you provide yourself and your family with a stress-free year of finances? Here are a few tips to improve your credit score:
Check your credit limits on your loans, accounts, credit cards and overdrafts, and then see how much you owe on each of them. One of the best ways to improve your credit score is to decrease the amount of credit that you’re using. Make a plan to pay off as much of your outstanding balances as possible: it will reflect on your score, and ease the pressure on your finances.
Another big no-no when it comes to a good credit score is late payments. The way to build a good credit history and credit score is to make regular and timely payments. If you have loans, accounts and credit cards, but your payment history is dragging down your score, dedicate the next year to meticulously making every payment on time. If you can pay more than the minimum payment in the process, that’s even better.
You’re entitled to one free credit report every year. Use it. Get a copy of your credit report, and go over it with a fine-toothed comb to check for inaccuracies, like accounts that you don’t recognise or incorrect information about late payments. Disputing this kind of inaccurate information, and getting it removed from your credit report, should improve your credit score.
Now that we’re limiting our exposure to public places and gatherings, it’s a good time to work on our budgets. Cook more at home, instead of going out. Use the money you’re saving on petrol to pay off some accounts. By budgeting and paying back your bills on time, you’ll be on your way to getting into great financial shape for next year.