Your credit score can make or break you. Banks, credit cards, and even landlords look at your credit score when deciding whether to lend you money or rent you an apartment and if your score isn’t high enough, they won’t do business with you at all! If you want to avoid the frustration of getting denied at every turn, it’s important to follow these tips to help you pay your bills on time and improve your credit score in the process.
Use all available methods
Whether it’s an online bill payment service or a check, make sure that all of your bases are covered. If you want to maintain a good credit score, get in the habit of paying all of your bills promptly. If you’re using an online service to pay those bills, always review them before they’re paid— and double-check that there aren’t any accidental extra charges! You can also ask your bank if they offer an automatic overdraft protection plan: if so, sign up for it! It makes sense to have as many things automated as possible when it comes to saving money (and staying out of debt).
Avoid Late Fees
The key to never paying a late fee is paying your bill on time. It sounds like common sense, but over 60% of Americans say they have paid a late fee at least once in their lives. Credit card companies offer several ways for you to avoid those extra charges including automatic payments and reminders when it’s time to pay your bill. Setting up automatic payments can ensure that no matter what, even if something goes wrong, you always get paid on time.
The best way to reduce stress is to be organized. If you keep yourself organized, it will make it easier for you when it comes time to pay those bills. Staying organized can also give you a clear picture of what’s going on with your finances, and it can help make paying those bills more streamlined. Staying organized doesn’t have to be hard; follow these tips and start getting organized today!
Pay with cash or check first
Each time you swipe a credit card, it’s reported to one of three major credit bureaus—Experian, Equifax, or TransUnion. This helps generate your credit score; cash purchases aren’t reported. In addition, writing checks, which get sent directly from your bank account and aren’t under your control once they’re written, won’t affect your credit score either. By paying with cash first, then using credit cards as needed (and never going over 30% of your total spending limit), you can prevent any late-payment headaches that may affect your credit score down the road. If checking is an issue for you but cash isn’t, just make sure to write yourself a check for everything so that it gets into your account when due.
Never be afraid to ask for help
There’s no shame in needing a little boost. Sometimes all it takes is a couple of dollars from a friend or family member—just enough to tide you over until next payday. Or, if that’s not an option, consider using peer-to-peer lending sites like Prosper and Lending Club; by sharing credit risk, these companies can offer loans with interest rates up to 25 percent lower than those offered by banks. If you use these services responsibly, they can be great options for managing cash flow and minimizing credit card debt. Plus, even if friends or family don’t have money to spare right now, paying off your debts quickly should still be a priority.