Top 3 Credit Hacks

Hello Money Masters!

Credit is one of those necessities in life that requires a great deal of maintenance. If you don’t yet know the power credit has in your financial life, you’ll soon find out. Those of us who have already begun our credit paths have learned that caution must be used when dealing with credit. Sometimes we make mistakes and sometimes we make exactly the right move. 

In any case, there are ways to boost your credit score and ensure more positive information on your credit report. May I present:

The Top 3 Credit Hacks

Higher Limits

A large factor in your score comes from the relationship between the amounts you owe and your credit limits. The ideal situation here is to have no or low amounts owed so that your utilization rate remains in the low percentages. But what if you are not in a financial position to pay down the debt?

Here’s the hack…. Try to get your credit limit increased. Having more available credit increases that gap between what you owe and the credit limit. Just be vigilant about not using that extra credit or you will negate all your efforts to boost your score. 

Get Authorized

When trying to boost your credit score or even establish credit, it may not be possible to open a new account or to increase your limits. What is a person to do? Look to your friends and family.

Here’s the hack…This is something I just mentioned in one of my Facebook videos and a lot of you might be thinking “oh wow, I can actually do this?” Ask a trusted friend or family member with already good credit to add you as an “authorized user” to their accounts. If you are an authorized user on a credit account, the primary account holder’s credit will reflect on yours as well. Now, this doesn’t mean you get a card and can use it. Also, it is especially important to ensure that the primary account holder makes payments on time and doesn’t carry an outrageous balance!

No New Credit

A hard inquiry or “hard pull” on your credit report is when a creditor checks your credit for the purpose of giving you a loan or credit card. A hard inquiry can stay on your report for about one year and negatively affect your score. Examples of a hard credit inquiry are when you try to get a car loan or apply for a mortgage, student loan, or credit card.

Here’s the hack…Do not apply for any new credit for a year. Remember, multiple hard inquiries can reduce your credit score by 5-10 points each, possibly resulting in the difference between fair vs. poor credit or fair vs. good credit, etc.

Credit hacks can be useful things, but keep in mind that they should not replace responsible and correct financial practices. Use credit with caution and always stay focused on your financial goals!

Blessings to you all,

-Helen