With interest rates on the rise it is more important than ever to maintain an excellent credit rating. While any score over 700 is enough to be considered “good”, only a select few manage to attain scores over 800, putting them in the “excellent” category, which gives you access to the best loan rates for everything from mortgages to new car leases. Better rates can save you thousands of dollars over your lifetime. While it is difficult to achieve excellent credit and it can take some time it is achievable and these tips from CNN Money can help you get there.
- Start Early - Length of credit history plays a strong part in determining your credit score so opening a credit card at a young age and making timely payments helps build your rating and get things headed in the right direction. Budgeting and keeping spending in line with earnings also builds good financial habits to keep you on the right track.
- Don’t Close Credit Cards - In order to keep your credit history strong and maintain low credit utilization ratios don’t be quick to close credit cards. This lowers your overall limit and can affect your history as well. Even if you prefer a different card you should also try to make a purchase at least a few times a year to keep the card active and avoid having the issuer close it for you.
- Don’t Max out Credit - Even if you pay off your balances every month getting close to a card’s limit hurts your credit by increasing your utilization level, which is the ratio of your usage to your limit. Keeping this number below 10% is the best way to push your score over 800.