With Christmas around the corner and holidays on the horizon, you need to consider your credit score and plan your bill payments for the end of the month.
For many, it is not a consideration until it is required, and sometimes that is too late.
Individual and company credit scores are an essential aspect of any future financial loans.
As an individual or business, you are issued a credit score based on how you manage your required payments and debt.
If you always pay your bills late, for example, you are penalised. This does not necessarily immediately affect you, but once a trend emerges, it can be detrimental.
Lenders and banks look at your history track record with debt, credit cards, and loans to establish if they will lend you money. It can also affect the interest rate they will offer you.
If you have a bad credit score, they can charge a higher interest rate.
How to get an excellent credit score
Keep your credit and debt low. Maxing out your credit card and only paying the minimum payment is not the way to go. Showing lenders can manage debt responsibly by paying off your credit card or keeping utilisation low helps.
Pay bills on time
There is no excuse to miss a payment or forget to pay a bill on time.
Set up future dated payments or debit orders can ensure you always pay on time, every time.
Check your credit score for mistakes
It does happen that there can be an error on your credit score. Regularly checking it can ensure that your accounts are in order, your names are spelled correctly, and there are no fraud accounts on your name.
Monitor your score and aim to improve it
When you know where you stand, you can actively work to improve it. Companies like ClearScore offer you a free credit score report a year. Companies mostly use Experian, TransUnion, Compuscan, and XDS.
Plan ahead for credit
When you know when you may need credit helps you plan for it. Ensure as many accounts are paid up as possible before applying so you can increase your chance of success.
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