5 Ways to Improve Your Credit Score (and Why It Matters)

Credit ScoreThe world of credit is confusing to many people. This is why so many people end up with massive amounts of debt. You don’t want this for yourself. Your credit score is the story of your credit history. Financial institutions won’t want to lend you money if they see a pattern of unpredictability. Here are five ways to improve your credit score, and why it’s important.

Don’t Max Out Your Credit Cards

Say you have a credit card. It has a monthly limit of $3,000. Every month, you put at least $2,000 on the card. As long as you pay it back, you should have perfect credit, right? While that might seem logical, it isn’t exactly the way of credit scores. Credit agencies use something called credit utilization to determine your credit score. Essentially, credit utilization is the percentage of your available credit you use every month. It’s suggested that your credit utilization shouldn’t exceed 30 percent. That would be $900 for a $3,000 limit. This is a sign to credit reporting agencies that you don’t mindlessly spend your money.

Consider Paying Twice Per Month

This point goes along with the previous one. You can’t be entirely sure when credit reporting agencies will look at your outstanding balances. Depending on how much you’re spending, it might be smart to pay off your card twice per month. By doing this, you’ll be less likely to be over the 30 percent credit utilization threshold at any given time.

Again, even if you consistently pay off your whole bill, your score might suffer due to high credit utilization. And if you have a low credit score, your finances will suffer in other ways. It will be more difficult to get loans—even with less attractive conditions. It can also affect your insurance costs. Try to compare car insurance rates to see how your credit score might be hindering your premiums.

Always Pay on Time

Late payments are not your friend. Payment history accounts for about 35 percent of your FICO score. FICO is a company that specializes in predicting consumer behaviors. They have developed a score that helps lenders determine the likelihood of future outcomes. If you have missed payments in the past, that’s going to count against your FICO score.

Think of it this way: Would you want to lend money to someone who has a history of not paying it back? Probably not. Banks and lenders don’t want to do that either.

 

Raise Your Credit Limit

Another way to improve your credit utilization level is to raise your credit limit. There are a few ways you can do this. First, you can request that your credit card company raises your limit. If you have a solid history of paying on time, it’s likely that they will be okay with this. You can also open up more lines of credit. Reporting agencies include all open lines of credit when determining credit utilization. So if you have multiple cards, you can just spend a little bit on each of them. It’s important to note that you need to have some restraint if you pursue these options. You can’t just adjust your lifestyle to spending more once you get more credit. This will raise your credit utilization back to previous levels.

Become an Authorized User

This option isn’t going to be available to everyone. Authorized users are allowed to have a card in their name on someone else’s account. This is an easy way to build your credit, as it raises your limit. Just make sure you’re extra responsible if you’re an authorized user. You won’t want to cause any problems for the person generous enough to help you out so much.

There’s nothing fun about credit scores. Fortunately, they don’t have to be so intimidating if you understand what affects them. Try to improve your credit score by implementing some of these techniques.

How to Save Money and Time while Traveling for Business?

time and money saving tipsIs yours a field job that requires regular trips inside and outside the country? Traveling for business is something which cannot be avoided. Be it for delivering lecture at conferences or to attend events or to meet new clients, a business trip always adds things to work, from an expansion in businesses to a new experience, unforgettable memories and a fresh perspective.

Regular travel may become monotonous or tiring for some. At the same time it is also time consuming and may end up heavy on your pocket, especially if the trip didn’t go as planned and brought in nothing.

For such business trips, there are a few simple ways to reduce the amount of money spent, over and above the travel allowances that you get from the company or the client.

  • Use cards for payments

Heavy transaction costs are levied on cash payments if you are traveling abroad. Use credit or debit cards to avoid this. On card transactions too some amount of international charge is applied but this can be controlled by calling up your bank before leaving the country and informing them about your plans so as to avoid paying extra charges.

  • Layer up

This may come off as an odd way to save money but it surely is effective. Wear layers of clothing. When it gets too warm outside and if you are wearing a tank top beneath your top then you will save yourself from the unwanted expense of shopping. Similarly if you wear a full sleeves t-shirt then you are all set if it gets chilly outside. That is how the layers are going to help you in your journey.

  • Pack light

The easiest way to save time is to pack light by carrying only on board luggage. Thereby you won’t have to wait each time for luggage at the arrival.

  • Stick with a single brand

If you are a frequent flyer then stick to one airlines. As your flying hours will start adding up you will be eligible to avail coupons and special discounts. Same goes for hotel bookings. Stick to one chain of hotel wherever you go to avail their special benefits over time.

  • Pack medicines

This goes without saying that, in your travels, be it for business or pleasure, you should always carry all kinds of medicines even if you are not taking any currently. First, the money that is  saved from the expense that you otherwise would have had to make. Secondly, the not so obvious reason for which you should pack even unnecessary medicines is that you can’t take any risks by depending on the unfamiliar place for getting all your medications, if the need arises, especially if you are on a business trip. Health is wealth undoubtedly.

  • Traveling can be avoided

There are alternatives to traveling. It is not extremely necessary to travel. With the age of internet and technology, business trips can be easily avoided and carried out virtually through a Skype call or Hangout meetings.