Building a good credit score takes time, one of the reasons being the need to gather a history of on-time payments. However, building good credit is important because it can result in more favorable rates for car loans, mortgages, and even insurance. Additionally, it can help if you are looking to rent a home or apartment. There are several ways to help achieve a higher credit score that everyone should note.

Make your payments on time and pay at least the minimum. As mentioned previously, paying credit card or loan payments on time, every time, is necessary to building good credit. Setting up automatic payments is one way to never make the mistake of a missed or late payment.

Keep your credit utilization low. The general rule for credit card usage is to keep your utilization below 30%. This means that you should always avoid maxing out any line of credit and keep usage low as much as possible.

Avoid applying for multiple credit cards at once. Applying for credit cards can cause a small and temporary drop in your score known as a hard inquiry. However multiple applications can cause more significant long-standing damage. It is recommended to space out any applications at least six months apart to avoid these types of issues. However, since credit card usage can result in an increase in spending, it likely doesn’t make sense to have many different cards anyway. Be cautious of one-time deals and offers aimed at getting you to open additional credit cards; these promotions are structured to get you to spend more. 

While building a strong credit score can be helpful, it is important that it never comes at the expense of your budget. Establishing an emergency savings that will cover 3-6 months of expenses, and following a monthly budget that balances your income, required expenses, and savings goals are important steps towards financial well-being.  

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Source: https://www.nerdwallet.com/article/finance/how-to-build-credit?trk=nw_gn_6.0#habits