Psst! We’ve got a secret for you! Boosting your credit score doesn’t actually take much effort. It’s mostly just little things you do in the background. And we’ve got all those little things here, in one short guide.
Now, none of our tips are guaranteed to improve your credit score. We thought we’d get that out of the way at the start (because, err, we legally have to) but don’t be put off. Small steps at first, but it all adds up.
And once you’ve finished reading, please give us a like on Facebook - we’re always posting new content that we think you’d like to read so it’s a great place to remain in the loop.
Now then, our tips to launch your credit score . . .
Keep your credit card balance low
If you can keep your credit card balance low, then you have a low ‘debt-to-credit ratio’. That’s a good thing because it shows you’re living within your means, rather than being on the financial limit.
Find other (responsible) ways to live your life on the limit instead.
‘Low’ is generally considered to be less than 25%, so if the limit on your card is £1,000, keep the balance under £250 if you can.
Use your credit card regularly
Keep your credit card balance low, but don’t stop using it altogether.
By regularly spending small amounts and paying it off at the end of the month, you’re keeping your credit active. That shows you can be trusted to pay back any money you borrow.
Register to vote
Getting onto the electoral roll means the credit reference agencies will find it easier to verify your address.
Do it by the 26th of November and you’ll also be able to vote in the General Election. Win win! Register to vote here.
If you’re not eligible to vote in the UK (meaning you can’t get on the electoral roll), you can send the credit reference agencies proof of your residency and ask them to add a note to verify this. This can be a UK driving licence or a utility bill.
Check your credit report regularly
Your credit file is being updated all the time (well, once a month) so keep a lookout for anything that’s not right. The sooner you spot any errors, the sooner it can be corrected. If you do see something on there that shouldn’t be, this guide from ClearScore lets you know how to fix it.
Check your address on old accounts
One thing to look out for on your credit file is your old address history. For example, if you’ve got an old mobile phone contract registered at a previous address that’s still showing as active, it could cause an issue for any ID checks. If that’s the case, get in touch with the phone provider or creditor directly to update their details, or if you’re not using it anymore, just close the account.
Pay your bills on time
Things happen and we can’t always pay everything on time - that’s a part of life. But if you’ve fallen into a habit of making payments late just because you’re a bit disorganised, it’s time to get back on track.
Your payment history gets fed back to the credit reference agencies, and lenders are more likely to trust people who have a good record of keeping up with their payments.
Minimise your overall debt
If you can, start making overpayments to any creditors or debts. The minimum payment is great to show that you can keep up with your payments, but reducing the total debt could also reduce your total debt-to-credit ratio.
Don’t apply for unnecessary credit cards
Making a lot of applications at once raises alarm bells for the credit reference agencies that you might be struggling for cash.
If you do need a credit card but are worried you might be declined, there are some great eligibility calculators you can use before applying such as this one from MoneySavingExpert.
Cancel unused credit and store cards
We’ve mentioned your debt-to-credit ratio a few times, but weirdly, having access to too much credit can be a bad thing. If you have a number of unused cards, it can be a good idea to cancel some to reduce your overall credit limit.
Saying that, you’ll still want to have a degree of available credit, so don’t cancel all of them. You need to find a balance. If you have a lot of unused cards, get rid of some, but keep the ones with a longstanding history of payments being made on time.
And . . . that’s it!
There you go. Minimum effort tips, most of which you’ll just do in the background. Here’s a handy chart to recap the main points (and some things to avoid).