How To Improve Your Credit Score

Aug 12, 2019 | Budgeting, Finances, Get Out of Debt

Your credit score is a big deal! If you need to know how to improve your credit score, we've got some tips on the dos and don'ts to help raise your credit score so that you can be financially successful!

woman using computer to research how to improve credit, from Fun Cheap or Free

Debt. Most of us have been there in some form or fashion! While some debt can be good for you (because how else are you supposed to build credit, after all?), too much debt can wreak havoc on your credit score.

*Note: When you click the links in this post, we may receive a commission at no extra cost to you.

Never fear, Freebs! After you're done reading this post, you'll know how to improve your credit score. You'll have a game plan figured out and be prepared to start on some good habits to raising your credit score. So let's get to it, shall we?!


There are a lot of things that you can be doing that will help to improve your credit score. But remember, it takes TIME to raise your credit score. So don't expect to do all of these things and then see instant results!


The first thing that you need to do to help improve your credit score is to come up with a plan! If you're in debt, then you need to come up with a budget if you don't already have one. This will allow you to make a plan for all of your money and know exactly where it's all going. Doing so will also let you know how much money you have left to put towards paying OFF that debt!

If you need help to figure out how to pay down your debt and improve your credit score, then check out Budget Bootcamp! It's a fun video program that will help you to whip your wallet into shape and tackle your finances.

You'll get a full refund if you don't save at LEAST what you paid for the program. You've got nothing to lose! Use the code FCFBLOG to get an extra 10% off just because!


Start paying all of your bills on time, not just your credit cards and loans. Paying your credit cards and loans will obviously help to improve your credit score. But make sure that you're also paying your rent, mortgage, utilities, cell phone, and any other bills on time, too! This will help you when it comes time to apply for a future line of credit since it will show future creditors that you are reliable when it comes to paying your bills.

Late payments are REALLY bad for your credit, they will stay on a credit report for 7 years! The only good news is that their impact on your credit score does go down as time goes on.

The biggest tip that I can give you for paying your bills on time is to set up reminders! Put the due dates on your calendar and set up reminders on your phone. Or better yet, set up automatic payments so you don't have to remember to pay each month – although it is a good idea to check and make sure these payments go through correctly on a monthly basis! Automatic payments are only a good idea if you know that you will have the money in your account.


couple discussing debt, from Fun Cheap or Free

This one is probably a given, but it's so important! If you have pressing debt (anything that has an interest), then you need to focus on getting those lines of credit in control. Are you thinking to yourself, “Where in the heck do I even start with paying down debt?” Have no fear, I've got your back! I've got 3 simple steps that you can start doing TODAY that will help you to get out of debt, so make sure that you go read about them.

A big tip for paying down debt is to make extra payments towards your pressing debt! When you put extra money towards a loan or credit card, you're paying on the principle rather than on the interest. Just paying an extra $20, $50, or $100 a month can really help you to chip away at that debt!


Once you've got your debt under control (woohoo, party time!!!), it's time to make sure that your credit utilization ratio is in the green, too. The credit utilization ratio is how much you owe on all of your lines of credit compared to how much you have available to borrow over all of your lines of credit.

In order to improve your credit score, you want to keep your credit utilization ratio at or below 30%. Let's do a little bit of easy math (shhh, don't tell my college calculus professor!) to help you understand this a little bit better. If your total amount of credit available to use is $10,000, you only want to be borrowing a maximum of 30%, which would be $3,000. This means that you should only ever be borrowing $3,000 total over all of your lines of credit.


Every 12 months, you can get your credit report for free from the big 3 credit bureaus (Experian, Equifax, and TransUnion). Some credit card companies will also generate this for you for free. But did you know that you could report any errors that you find on your credit report? This is an easy way to improve your credit score if you do find any mistakes.


Alright, so we've gone over the dos of improving your credit score. Now it's time to go over the DON'TS.


cutting up a credit card, from Fun Cheap or Free

Unless you just have a really good reason, don't even think about canceling a credit card account! Just cut that bad boy up and don't blink an eye at it anymore. Remember the credit utilization ratio that we talked about? Even if you're not using a credit card, that's still a line of available credit that is being factored into your credit utilization ratio.

When you close an unused credit card account, that lessens your amount of available credit. If you're using right at 30% of your ratio and close an account, then you will definitely go over and your credit utilization ratio will be all out of whack.

Now, if these unused credit cards are costing you a yearly fee and if you're not close to using 30% of the ratio, then you could consider closing it. Just be smart when you're making decisions like this that will impact your credit score!


When you apply for a new line of credit, it will show up as a hard inquiry on your credit report, which dings your credit score and will lower it. If you have a good credit score, it won't affect your score that much. But if your credit score is already low, you don't need anything that will make it go lower. A hard inquiry will stay on your credit report for 2 years.

If you apply for multiple lines of credit, that is multiple hard inquiries that will have a greater impact on lowering your credit score. So while it may be tempting to apply for a new credit card to help out with your credit utilization ratio, know that it is going to have a negative impact on your credit score!


Opening too many new accounts in a short amount of time is also a red flag for lenders. It tells them that you may have credit problems and makes it harder for you to get a loan. So really think through before you apply for a new line of credit and wait at least 6 months before you open another one.

Okay, well there you have it! You now know how to improve your credit score and can get started on rebuilding your credit. Good luck and let us know if you have any questions in the comments!

Everything you need to know to improve your credit score from Fun Cheap or Free

Looking for more finance posts?

Give yourself some credit!


  1. Jaz

    From what you have studied and knowledge in general, what would you do if you have no debt and have a zero for a credit score? It is in part because we’ve been out of debt so long and the other part of not keeping our one credit card open. We don’t make enough to buy a home out right, but with kids increasing in number pretty steadily and rent going up we’d prefer to get a home in the next year. Any tips for that credit situation?

    • Fun Cheap or Free

      It is great that you have no debt and have been out of debt for so long, congratulations! However, you have to have a line of credit in order to be able to work on your credit score, the two go hand-in-hand. I would suggest doing your research to find a credit card that works for your family. I highly recommend a cash-back rewards card, since you can redeem your rewards for cash versus airline points (unless you travel a lot and that would work better for you). If you have your budget under control, and it sounds like you do, then you should easily be able to start using your credit card to pay for your routine purchases like groceries, gas, etc. As long as you pay off your card each month and you keep your income to debt ratio under 30% (so only charge a maximum of 29% of the total line of credit each month) then you should see your credit score start to climb in no time! ?

  2. Becky Roumimper

    Does it make sense to consolidate credit card debt into one loan at a much lower rate or keep chipping away at the high interest rate bills?

    • Fun Cheap or Free

      I’m not a certified financial planner, so I really can’t advise you one way or another on this, so sorry!

  3. Rachelle

    I just had a credit card company close my account due to inactivity and a high debt to income ratio. No warning of closing the account at all. Knock on wood, Never had a late or missed payment in my life. Iā€™m afraid my credit score will be even worse because they closed it. šŸ™ I just found your site so I am hoping I can learn how to get back on track. I have $14k in debt but I know through hard work that can change. Thank you for all of the information.

    • Fun Cheap or Free

      Oh no! It will be hard, but you can do it!!! We have lot of free tips here on the blog, so definitely read through the site and get all the info that you can! If you haven’t read THIS post yet, it’s definitely a good place to start. šŸ™‚


Submit a Comment

Your email address will not be published. Required fields are marked *