4 Ways to Protect Your Credit Rating

If you’re like most people, you have identified your financial priorities and set a budget to help yourself meet them. But smart money management goes beyond spending habits. You can save yourself hundreds or even thousands of dollars per year by taking these four steps to protect your credit rating.

Watch your credit card balances and number of accounts.

Yes, it can be smart to take advantage of credit card offers for free airline miles or cash back rewards. But remember to pay off your balances each month, because carrying a high debt load can damage your credit score. Also remember not to open too many accounts, because credit bureaus look upon that behavior with suspicion – even if you’re just opening accounts to access the perks.

Regularly review your credit report.

Once your credit report suffers damage, it can take years to repair the damage. So even if you aren’t planning a major purchase in the near future, you might wish you had paid closer attention to your credit report when it’s time to buy a house or car one day. Check your report for suspicious behavior at least once per year, and immediately file report about any suspicious behavior. Vigilance is the best defense against credit theft.

Leverage a great credit score any time you get a chance.

People with high credit scores are often viewed as more desirable customers. Any time you are in a position to negotiate a price, allow the salesman to run your credit. He doesn’t have to know if you plan to pay cash for the purchase. Demonstrating your high worth as a customer can save you hundreds dollars or more.

Don’t forget about your business accounts.

Often we find that business credit card accounts are tied to the personal credit history of the business owner. Follow all of the same rules you would follow with a personal credit card, and you can prevent harm to your credit score.

Remember, your credit score will impact your life for years to come, and in surprising ways. Set aside a few minutes each month to oversee all of your credit accounts, and you will thank yourself in the future.