Below are the top credit management tips that we share with our clients.
- If possible, always pay off 100% of your credit card balances on the scheduled payment. The credit card companies will charge interest on the total balance if you make a partial payment. For example, if you have a $1,000 balance and you payoff $999, the interest is calculated on the $1,000 balance.
- If you maintain credit card balance(s), it is better to have multiple cards with 30% of the available credit used vs one card with 90% of the available credit used (assumes total balances are equal). Your credit score is adversely affected with high usage percentages.
- Put your credit cards on auto payment. Even if is just the minimum payment. This will save you from a missed payment and getting a derog on your credit report.
- Check your credit report for free, three times a year. Each credit bureau is required to provide a free annual credit report at: annualcreditreport.com. Since there are 3 credit bureaus, you can spread out when to pull the free credit reports (for example, April/Experian, August/TransUnion & December/Equifax).
- Tired of getting unsolicited credit offers in the mail or by phone? You may be able to reduce their frequency by opting out of the pre-screened service that the credit bureaus make available to credit vendors. Here is the link to optout: optoutprescreen.com.