Maintaining a healthy credit score is an excellent way to save money and reap many benefits along the way. Your credit score is a perfect financial tool that creates many financial opportunities for you. If you need a loan, your credit score will be the most significant determining factor whether you’re going to get approved or not.

That aside, a great credit score is also what ensures that you get to tap into a wide range of financial products with lower interest rates. When you keep your additional expenses on a minimum, that means more cash for you.

In other words, you need a healthy credit score if you plan on applying for credit, loan, or credit card. However, this is where we encounter a little problem – financial irresponsibility. Not all people know how to manage and maintain their credit, and they usually end up with a bad or poor credit score.

Since lower credit scores mean more risk for lenders, creditors, and card issuers, you’ll end up with higher expenses, interest rates, etc. These debts tend to pile up like crazy, and before you know it, you find yourself in an endless financial turmoil.

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To prevent this from happening, we’re going to mention all the things that you should avoid doing at all times to improve, build, rebuild, and keep your score healthy. We’re also going to toss in some useful tips on how to improve your credit score to make sure your financial standings improve significantly.

20 Credit Score Don’ts

If used correctly and responsibly, credit can be quite a useful, convenient, and beneficial financial tool in the right hands. It is essential to understand how it works and what makes it go up.

In the end, it all comes down to your responsibility and the reality of repaying your debt. So, with that in mind, we’re going to mention the most important things that you need to stop doing ASAP if you want your credit score to look great.

  1. Don’t take a credit card if you don’t need one

    Having a credit card is a financial privilege that allows the user to access funds they don’t actually possess. However, there is a wide range of things to worry about when using a credit card. Terms and conditions, annual and monthly fees, penalty fees, grace periods, credit limits, and interest rates can make or break your current finances.

    So, do not take a credit card if there isn’t a need for one. Not all people know how to use their cards responsibly, and they end up spending more than they can afford. So, if you’re financially healthy at the moment and you don’t need a credit card, feel free to say no to banks when they offer one.

    This goes without saying if you already possess a credit card or other cards. If you already have more than one credit card, the chances are that you already have balances on them. Applying for a new one will only push you further down the rabbit hole.

  2. Don’t apply for multiple credit accounts

    Opening more than one credit account in a short period isn’t a good idea, not even if you’re financially stable. Aside from damaging your credit score, this will only create additional expenses and make your credit more expensive.

    If you need more than one credit account, we recommend that you talk to financial consultants. The majority of these professionals offer consultation advice for free. Introduce them to your current financial situation and needs so that you can gather useful information and make an informed and educated decision.

  3. Don’t be late with your payments

    Every bill impacts your credit score. If you regularly pay your bills late and miss payments, that won’t look good on your credit report, which will hurt your overall score. That aside, this lack of financial responsibility tells a lot about you to creditors and financial institutions.

    If you need any financial product, they will first look at your report and score to assess the risk associated with lending you their products. The higher the risk, the higher the interest rate, introductory rate, etc.

    Late payments are nothing but trouble, and they can make your credit rating look really bad. Also, late payments include a late penalty fee, which is nothing but another additional cost to worry about.

  4. Don’t spend more than you can pay back

    Spending more than you can afford is the worst thing you can do, and it will ruin your credit score for good. Remember that your irresponsible behavior tends to stick on your credit report, long after you have rebuilt your credit. Using credit means spending the means you don’t actually have.

    That’s why interest rates are so high. So, use it wisely and only if you have to. If you have to use your credit, keep in mind that you’ll need a good plan to repay your debt. Your credit limit is a type of loan. The more you spend it, the more interest you pay.

    The best way to know how to make a difference between the time to use it and time to say no is by thoroughly understanding your own needs and wants. Wants you can do without, it’s the needs that require your immediate attention. If you continuously spend on things you don’t really need and only pay back the minimum, you could be ending up paying your debts for months.

  5. Don’t go over your credit limit

    Never, and we do mean it, never go over your credit limit. It would be wise not to reach it at all, but if it happens, make sure you don’t max out your card. This is one of the worst things you can do, and it will look awful on your report.

  6. Don’t ignore your financial trouble

    No one falls into credit trouble overnight. It is a lengthy process with many smaller and bigger warning signs along the way. The trick is to learn how to recognize these signs and do something about them. Ignoring your problems won’t make them go away, quite the opposite, it will only make them even worse.

    A couple of warning signs to pay special attention to include using cash-advances to pay for living expenses daily, piled up late payments, and paying only the minimum balance for a long time. These are clear signs that you’re walking on a dangerous edge of falling in the financial danger zone.

  7. Don’t disclose your financial information

    Unless you’ve already initiated a transaction, never disclose your financial information such as your credit card number, PIN, and so on. Keep your mind on scam artists and identity thieves who can abuse your information in a wide variety of ways that will only make your financial situation worse.

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  8. Don’t take the first credit card you’re offered

    There are many different credit cards and card issuers around. Going with the first offer is usually a wrong financial decision. Instead, feel free to explore your options. Compare terms and conditions, annual and monthly fees, introductory rates, grace periods, credit limits and limitations, penalty fees, interest rates, etc.

  9. Don’t use different names when applying for credit

    Using a different name each time you apply for credit isn’t a smart choice. So, always use the same name as this can look good on your credit report. Consistency is always a good thing.

  10. Don’t skip the fine print

    Each credit application includes some form of fine print, which most applicants fail to read. They’re also unaware that the application is a form of contract.

    Once you’ve signed it, there’s no coming back. So, make sure you inspect every detail and pay special attention to terms such as interest and introductory rates, and what happens when the grace period expires.

  11. Don’t avoid asking questions

    If there are some things on your credit report that don’t make sense, please ask about them. Credit bureaus do tend to make mistakes. If you’ve noticed an item on your report that you think is a mistake, ask about it. This can help you improve your credit score.

  12. Don’t go over your budget

    You must set a realistic budget and stick to it. The only way to get a hold of your finances and keep them in order is to develop a financial plan. Many people go over their capabilities only to end up in debt.

    Regardless of how good or bad your credit score is, you should always have a budget set up straight so that you know your financial standings at all times. Aside from keeping your credit score healthy, this will also help you save on unnecessary expenses.

  13. Don’t accept any credit fix solutions

    The internet is swarming with various companies and financial professionals who claim they can fix your credit. This isn’t true most of the time, and it’s nothing but a scam or a rip-off.

    No one can fix your credit overnight. That’s simply not how things work. The only way to improve your credit is to develop a healthy payment history, and that takes time, effort, and discipline.

  14. Don’t keep a closed bill

    Paying your bills on time is one of the best ways to make sure your credit score is healthy. That’s why you should open your bill and make sure to pay it on time every month.

    While this helps keep your credit score and history in a positive light, it also enables you to save money by avoiding hefty late and penalty fees. Besides, this also protects you from any unauthorized charges and identity theft.

  15. Don’t avoid getting in touch with your credit card issuer

    In case you have any problems with making payments, contact your creditor immediately. Don’t ignore any issues with your credit cards. The same goes if you don’t have the means to cover your debts at the moment.

    The majority of reputable credit card issuers will offer some kind of financial help to come up with a payment plan that allows you to manage your debt more easily and conveniently.

  16. Don’t lose your credit card or give it to third parties

    Having a credit card involves a certain dose of responsibility. If you’re carrying it with you, keep your PIN in a separate place. The last thing you want to deal with is losing a credit card along with your PIN.

    It’s like giving your money to someone you never met in your life. So, keep your card secure at all times and always have a customer support number ready, in case the unpredicted happens or your card gets stolen.

  17. Don’t think of your credit as of simple figures on a computer

    Most people make a great mistake in mistaking their credit cards for nothing more than pieces of plastic. Well, they can’t be more wrong, and that’s the main reason why many of them wind up with debts they can’t pay off. A credit card is a long-term investment. The same goes for your credit.

    It’s like investing in your future. The wiser you use it, the more benefits you get to reap. People who are smart with their credit can quickly build or rebuild positive credit history and improve credit scores.

    Remember, your credit is a determining factor as to whether you’re going to get approved for a loan to buy a home or a car, get a new job, rent an apartment, or a new credit card.

  18. Don’t forget to check your credit report on time

    Feel free to have a look at your credit report copy once in a while. Since it’s free to ask for it and it doesn’t affect your credit score in any way, you should check your credit report monthly or annually, depending on your financial needs.

    You’re a credit customer in the eyes of lenders, creditors, etc. Each time you apply for a financial product, these financial institutions rely on your credit report to assess the risk associated with lending you their products.

    Aside from evaluating your performance, checking a credit report regularly also allows you to spot any errors or mistakes. You need your report to be accurate before you apply for any loans.

    RELATED: 3 steps how to get you annual credit report for free

  19. Don’t close your credit cards with a long history.

    If you’ve opened an active credit account and had it for long, think twice before closing it. Such an account is good for your credit score because of the long history.

    Suppose you’ve had a long history of successfully repaying your credit card debt for a long time. That history speaks volumes about your financial responsibility, behavior, and eligibility for various financial products.

  20. Don’t increase your credit limit without a really good reason

    Finally, avoid increasing your credit limit unless there is a real goal behind such an action. More credit doesn’t necessarily improve or increase your credit score.

    It’s quite the opposite. Creditors see having more credit as a higher lending risk. More credit means the potential to get into a huge debt.

Tips to Maintain a Healthy Credit Score

Since you’ve worked too hard to build a good credit score, let’s make sure you keep it that way. Here are a couple of useful tips that should help you stay in good financial standing.

  1. All debts are equal

    All debts are taken into account for your credit score. Mortgages, credit cards, everything counts. Regardless of which line of credit has the lowest interest, you should view all your debts equally and never skip a payment. It will only hurt and lower your score.

  2. Keep old credit cards

    The older your credit card, the longer the history of making payments. This greatly benefits your score and tells a lot about you in terms of risk assessment.

  3. Keep the number of credit cards to a minimum

    Having more than one credit card may sound smart, but it can become a nuisance if you overuse your cards. Eliminate nuisance balances to improve your credit score.

    If you want to pay off your debts, consider applying for a balance transfer card, as this solution might help you consolidate all your debts onto one card.

Final Word

We sincerely hope that these tips will help you maintain a healthy credit score for a very long time. If your credit score is already good, it’s not hard to keep it that way.

All it takes is consistency with paying your bills and making payments on time. Avoid overspending, take measures to lower your credit utilization and reduce your debt, and avoid taking credit if you don’t need to.

Market Pro Secure® requires content creators to use primary sources to support their work. These include original data, white papers, interviews with industry experts, and government information. We also reference original studies from other reliable authors where appropriate.

  1. Consumerfinance.gov. “Credit Report & Scores“. Last Accessed October 2, 2020
  2. Consumerfinance.gov. “Consumer Credit Trends“. Last Accessed October 2, 2020
  3. Annualcreditreport.com. “Free Report“. Last Accessed October 2, 2020