Things People with Good Credit DON’T Do

We hear a lot of advice about improving a credit score. It's time to take a look at what you should not be doing.

We hear a lot of advice about what you should do to improve your credit score. It’s time to take a look at what you should not be doing.

Your credit score is not a new topic for First Security State Bank. While we usually emphasize tricks you can use to raise your credit score, the importance of maintaining that score is often overlooked. Instead of listing a bunch of things you can do to raise your score, we are going to look at a few things that people with good credit DON’T do.

People with Good Credit Don’t:

1. Wait Until the Due Date to Pay Bills

Paying bills on time is not a new or novel idea. But just paying off bills by the due date will not guarantee good credit. If possible, pay off your cards by the report date. This is the date, typically a few days before the due date, is when a creditor sends updates to credit bureaus. If you haven’t paid your bill by the day, it could appear that you are carrying a balance from month to month. But when you pay by the report date, the creditor reports a zero dollar balance. And the less debt you have, the higher your score will be.

2. Open Retail Store Accounts

The credit inquiries that each retailer asks for impacts your credit score. Each one can reduce your credit score by up to five points. This may seem minor, but if you apply for multiple cards in a short period of time, those points add up. Is lower credit worth a one-time discount?

3. Stop Using Credit Cards

When you can’t control spending, it may seem like a good idea to cut up the credit cards. But people with good credit never stop using their cards, even if it means spending just $20 a month. Some credit card companies will cancel accounts after a certain time of inactivity. This can drive up overall credit utilization ratio, causing a drop in credit score. It can also shorten your credit history, which triggers a drop as well.

It is an achievement to raise your credit score, but it is even more important that you maintain it. This will make it easier to qualify for loans and earn lower interest rates. For more advice on getting your credit score up, contact First Security State Bank.