Ways to boost your credit score

Focus on your score — not your income As a credit expert, I encounter hundreds of high-net-worth individuals who assume they have a great credit score because of their wealth. But your income has nothing to do with your credit score. If you have $7 million in the bank but are late on your credit card payments, your credit score will still be poor. Missing a payment will affect anyone’s credit score. So make all payments on time, no matter what. Keep a good balance-to-credit-limit ratio When you want your credit scores to be as high as possible — for example, when you are applying for a mortgage — keep your outstanding balance on each card below 10% of the credit limit for a few months prior. So, if your credit card has a charge limit of $1,500, keep your outstanding balance below $150. It’s also helpful to have a limited number of credit cards with outstanding balances. Do not close credit cards; just pay off the balances. Become an authorized user If done correctly, being added as an authorized user on someone else’s older credit card account can boost your credit score. Since the average age of credit accounts has an impact on scores, being placed on an old card can age your credit and add points. But you have to be careful. The individual should have a strong payment history and low credit card balances. In addition, some card issuers reward cardholders with extra cash, points or miles for adding an authorized user.