8 STEPS TO A 800 CREDIT SCORE

On the standard a 300-850 range is used by FICO, a credit score of 800+ is considered “perfect.” That's because higher scores won't really save you any money. The number helps lenders decide how much of a credit risk you are. Paying attention to your credit score is a vital part of your financial health. Here are 8 Steps to a 800 Credit Score:

1. Understand the Facts. “What is a perfect credit score?”

It’s a three-digit number that determines how much you pay for credit. It can affect all expenses in your life. Lenders use it to determine how much of a credit risk you are.

2. Establish a Long Credit History

Building your credit score takes time. It takes a history of good habits and on time payments. You must have an account opened 6 months or longer and at least one creditor reporting your activity to the credit bureaus the last 6 months. Keep accounts open unless you have a compelling reason to close an account. Closing an account can hurt your credit utilization and reduce your average account age.

3. Pay Your Bills on Time

Make 100% of your payments on time. This includes credit accounts and other accounts such as utility bills. Unpaid bills that go to a collection agency will seriously hurt your credit score.

4. Redefine Credit Card Usage

Stick to one or two cards for simplicity. This will help you manage your credit score. Pay them off each month in full. Be disciplined with your spending. 6, 12, 18, or 24 month no interest offers to pay off an account are a good way to pay off a large purchase and enable you to pay the balance over time without any additional interest and build your credit score. This is good Money Sense.

5. Diversify Your Accounts

3 types of credit are: revolving, installment and open accounts. Their characteristics are as follows: Revolving accounts – The most common example of a revolving account is the credit card. These types of accounts involve different payments each month, depending on how much credit is used. Installment accounts have a fixed payment for a fixed period. An open account is a transaction sale where goods are shipped and delivered before payment is due.

6. Cut Spending

Make a budget, track your spending. Get serious about your needs and wants. When you can see where your money goes you will find ways to save.

7. Limit Your Liability

Use credit cards not debit cards for online purchases. Use ENV chip card technology that secures transactions and protects against counterfeit. Keep your credit card and CVV (card verification value) safe. Avoid entering sensitive information on public computers and Wi-Fi. Set up alerts on your credit cards tied to irregular activity. The faster you report a loss or theft the better.

8. Restrict Hard Inquiries

Checking your score won’t affect your score. Hard inquiries, which can negatively affect your credit score appear when a lender checks your credit when applying for  new credit. Soft inquires appear when a company pulls your credit without your prior authorization, or when you pull your own report.

In conclusion, following the above 8 steps will have you on your way to an 800-credit score which is vital to your financial health and is good Money Sense.