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How to Maintain a Good Credit Score

Jerry Brown • June 12, 2024

A man responsibly using his credit card to maintain his good credit score.

Your credit score is a three-digit number that reflects how well you’ve managed your credit accounts. Having good credit can help you qualify for lower rates on loans, which can help you save a lot of money in the long term.

That’s why it’s essential to understand how to maintain a good credit score. Read on to learn some ways to keep your credit in pristine shape.

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What is a good credit score, and why is it important to have one?

Before we discuss how to maintain a healthy credit score, let’s define what it means.

A good credit score can vary depending on the credit scoring model. However, based on the most widely used FICO credit scoring model, it’s often defined as a score of 670 or higher.¹, ² Generally speaking, the highest possible credit score is 850.

Having good credit signals to lenders that you’re more likely to repay your loan as promised. As a result, you may have an easier time getting approved and securing more favorable interest rates. It can also help you help you qualify for a new apartment if a landlord reviews your credit history.

5 Factors that affect your credit score

Many factors can affect your credit score. Since you have multiple credit scores, how they’re calculated varies depending on the credit scoring model used.

The two most popular credit scoring models are Vanguard and FICO. Each model has slight differences, but takes similar factors into account. Here are the typical considerations that make up your FICO score:³

  • Your payment history. Paying your credit accounts on time makes up 35% of your credit score.
  • Credit usage. How much of your total credit limits you’re using makes up 30% of your score.
  • Length of your credit history. Having a long credit history can have a positive effect on your score. In fact, it accounts for 15% of your score.
  • Credit account types. How many types of credit accounts you have – or your credit mix – accounts for around 10% of your score. For example, you might have a home loan in addition to your credit card.
  • New credit applications. The length of time since you’ve applied for a new credit account represents 10% of your score.

6 Tips for maintaining a good credit score

Maintaining a top-notch credit profile requires practicing good credit behaviors. Here are five steps to help keep your credit score in good shape. Practicing these habits can also improve your credit score.

1. Stay on top of your bills

Your payment history represents the largest percentage of your credit score. Once your payment becomes 30 days past due, a company can report your late payment to the three national credit bureaus, which can cause your credit score to take a significant hit.

Enroll in auto-pay to stay on top of your payments. If automatic payments aren’t an option, keep track of your due dates in a spreadsheet.

2. Check your credit reports often

Credit reporting errors, like on-time payments reported as late, can lower your credit score. Check your reports often to ensure the information is accurate.

To check your credit reports from all three major credit bureaus, visit AnnualCreditReport.com. You can access these reports for free every week.

If you spot any mistakes while reading your credit reports, you can dispute them directly with the credit agency that lists the error. Afterward, consider disputing the error with the company that reported it to the credit bureaus.

Another benefit of regularly checking your credit reports is that doing so could help you prevent identity theft.

3. Maintain a low credit utilization ratio

How much of your available credit you’re using – your credit utilization ratio – accounts for around 30% of your credit score. Because of this, it’s a good practice to try to avoid maxing out your credit limits.

One way to keep your credit utilization low is to pay off your statement balance in full each month. This also helps you avoid paying interest. Asking your credit card company to increase your credit limit could also reduce your credit utilization.

4. Keep your credit card accounts open

In addition to using too much of your credit, closing your credit card account can also raise your credit utilization ratio. That’s because it lowers your total available credit.

Consider keeping your account open unless you’re closing it to avoid overspending.

Note that your issuer might close your card if it’s inactive for a certain period of time. To prevent this, consider making a small purchase on the card you no longer use each month to keep it open.

5. Space out your credit applications

Applying for multiple credit accounts in a short amount of time can cause a significant drop in your credit score. Each time a lender performs a hard credit check, it can can drop your score up to five points.

As a result, it’s a smart idea to space your credit applications out to minimize the impact multiple credit inquiries in a short period of time can have on your credit.

That said, some credit agencies will count multiple inquiries as only a single inquiry if you apply for several auto loans or home loans in a two-week timeframe to compare rates.

6. Think twice before co-signing a loan

Before you co-sign a loan for a family member or friend, make sure you fully understand how it could affect your credit. For example, if the person you co-sign for misses a payment – or worse, defaults on the loan – it can harm their credit and yours.

Maintaining good credit is a lifelong journey

Learning how to maintain a good credit score – or improve your current credit score – can help you enjoy the benefits that come with it, like better approval chances and lower rates. Practice the habits that helped you build credit to lower your potential lifetime borrowing costs.

If you want to learn more about how credit scores work, read our guide on how often credit scores update.

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¹ FICO® Scores are developed by Fair Isaac Corporation. The FICO Score provided by ConsumerInfo.com, Inc., also referred to as Experian Consumer Services ("ECS"), in Experian CreditWorks℠, Credit Tracker℠ and/or your free Experian membership (as applicable) is based on FICO Score 8, unless otherwise noted. Many but not all lenders use FICO Score 8. In addition to the FICO Score 8, ECS may offer and provide other base or industry-specific FICO Scores (such as FICO Auto Scores and FICO Bankcard Scores). The other FICO Scores made available are calculated from versions of the base and industry-specific FICO Score models. There are many different credit scoring models that can give a different assessment of your credit rating and relative risk (risk of default) for the same credit report. Your lender or insurer may use a different FICO Score than FICO Score 8 or such other base or industry-specific FICO Score, or another type of credit score altogether. Just remember that your credit rating is often the same even if the number is not. For some consumers, however, the credit rating of FICO Score 8 (or other FICO Score) could vary from the score used by your lender. The statement that "90% of top lenders use FICO Scores" is based on a third-party study of all versions of FICO Scores sold to lenders, including but not limited to scores based on FICO Score 8. Base FICO Scores (including the FICO Score 8) range from 300 to 850. Industry-specific FICO Scores range from 250-900. Higher scores represent a greater likelihood that you'll pay back your debts so you are viewed as being a lower credit risk to lenders. A lower FICO Score indicates to lenders that you may be a higher credit risk. There are three different major credit reporting agencies — the Experian credit bureau, TransUnion® and Equifax® — that maintain a record of your credit history known as your credit report. Your FICO Score is based on the information in your credit report at the time it is requested. Your credit report information can vary from agency to agency because some lenders report your credit history to only one or two of the agencies. So your FICO Score can vary if the information they have on file for you is different. Since the information in your report can change over time, your FICO Score may also change.Credit score calculated based on FICO® Score 8 model. Your lender or insurer may use a different FICO® Score than FICO® Score 8, or another type of credit score altogether. Learn More

² Information from myFICO's "What is a FICO score?" as of May 30, 2024: https://www.myfico.com/credit-education/what-is-a-fico-score

³ Information from myFICO's "What's in your credit score?" as of May 30, 2024: https://www.myfico.com/credit-education/whats-in-your-credit-score

⁴ Information from Equifax's "When late payments show on credit reports" as of May 30, 2024: https://www.equifax.com/personal/education/credit-cards/articles/-/learn/when-late-credit-card-payments-post/

⁵ Information from Federal Trade Commission's "You now have permanent access to free credit reports" as of May 30, 2024: https://consumer.ftc.gov/consumer-alerts/2023/10/you-now-have-permanent-access-free-weekly-credit-reports

⁶ Information from myFICO's "How do credit inquiries affect your FICO score?" as of May 30, 2024: https://www.myfico.com/credit-education/credit-reports/credit-checks-and-inquiries

⁷ Information from Equifax's "Understanding hard inquiries on your credit report" as of June 3, 2024: https://www.equifax.com/personal/education/credit/report/articles/-/learn/understanding-hard-inquiries-on-your-credit-report/

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