Four steps to improve your credit score

Your credit score can have an impact on many areas of your life, possibly even influencing your job prospects. When applying for a loan, your credit score plays a large role in a lender’s decision to extend credit and under what terms. Taking simple, consistent steps over time can translate into a higher credit score. Consider the following measures.

1. Pay your bills on time

Each month, pay at least the minimum amount due on each bill. A consistent record of bills paid on time will improve your credit rating.

2. Stay in touch with creditors

If you’re having trouble paying your bills, contact your creditors. They may be willing to work out a reduced payment schedule with you to help you get your financial situation back on track.

3. Pay down debt and credit card balances

Lowering your level of debt and the balances you carry on your credit cards can increase your credit score. It usually makes sense to pay off the card that charges the highest interest rate first. Just transferring outstanding balances to new accounts without actually making payments that reduce the amount you owe won’t raise your score.

4. Check your credit report annually

You can order your own credit reports from the three major credit reporting bureaus annually, free of charge, and check to see if there are any errors or problems at www.annualcreditreport.com.