7 Effective ways to build your credit score

Your credit score is a vital part of your financial health. It can influence your ability to secure loans, rent an apartment, or lock into a reasonable rate. Whether you're starting to build your credit from scratch or looking to boost your current score, we've got you covered. In this post, we'll dive into seven effective ways to improve your credit score.

1. Pay your bills on time

Payment history is the most important factor lenders consider when evaluating your credit. Timely payments on all your credit accounts, including mortgages, loans, and credit card accounts, show lenders you are responsible.

Late or missed payments can remain on your credit report for up to seven years, though their impact lessens over time. To build your credit score quickly, pay all your bills on time each month. Setting up autopay or calendar reminders can help ensure bills on time become a habit.

2. Pay down debt & keep balances low

Your credit utilization ratio—the amount of credit you’re using compared to your total available credit—is a major factor in your credit score. Lenders use it to gauge how responsibly you manage your credit accounts. A lower ratio signals that you’re not overextended and are more likely to pay your debts on time.

How to calculate it: Debt ÷ Total credit limits = Credit utilization ratio

Example: If your debt balance is $2,500 and your total credit limit is $10,000, your utilization ratio is 25%.

Most experts recommend keeping this ratio below 30%. The lower it is, the better it looks to lenders—and the faster you can see improvements in your credit score.

Tackling different types of debt

• Credit cards: Focus on paying down high-interest balances first. Even small consistent payments can reduce utilization and improve your score in a short period of time.
• Loans: While installment loans like auto or student loans don’t impact your utilization ratio as heavily as credit cards, making timely payments is crucial for maintaining a positive payment history.
• Multiple accounts: If you have multiple credit accounts, spreading balances across them rather than maxing out one card can help reduce individual utilization ratios, which is viewed positively by credit card issuers.

Strategies to pay down debt

• Snowball method: Pay off the smallest balances first to gain momentum and motivation.
• Avalanche method: Pay down the highest-interest debts first to save money over time.
• Regular monitoring: Track your balances and credit limits monthly to ensure you’re staying below the recommended utilization threshold.

By actively managing your debt, you demonstrate financial responsibility, reduce interest costs, and can raise your credit score faster. Paying off debt strategically also sets the foundation for qualifying for new credit accounts or even a secured credit card if you’re just starting out.

3. Become an authorized user

Being an authorized user on someone else’s credit card account can help build your credit history. The card’s payment history and balance will appear on your credit report, helping improve your score—provided the primary cardholder maintains responsible use.

Be aware: if the account holder makes late payments or maxes out the card, it can negatively affect your score. If you stop being an authorized user, the account history will no longer impact your credit.

4. Apply for a secured credit card

If you have limited or poor credit, a secured credit card is a great way to build credit quickly. These cards are backed by a cash deposit, which usually becomes your credit limit and is refundable when the account is closed.

How it helps: Using the card responsibly, making timely payments, and keeping balances low demonstrates creditworthiness to credit card issuers. Over time, this can help you qualify for an unsecured card and a good credit score.

5. Request a higher credit limit

Increasing your credit limit on a credit card account can reduce your credit utilization ratio and help your score. Contact your credit card issuer with employment, income, and housing information ready.

A higher limit can improve your credit score in a short period of time, while also giving more flexibility for larger purchases.

6. Add utilities & rent to your credit report

Many credit accounts don’t report certain regular payments, like rent, utilities, and phone bills, to a credit bureau. Services like Experian Boost, Rental Kharma, and LevelCredit allow you to add these payments to your report, helping your payment history reflect more responsible habits.

7. Dispute errors on your credit report

Regularly review your credit reports from all three credit bureaus: Equifax, Experian, and TransUnion. Errors can drag down your score. If you spot discrepancies, notify the bureau in writing with documentation.

Correcting errors can improve your credit score within 30 days, giving you a clean start and more accurate reporting of your timely payments and responsible credit use.

Track your progress

Building a strong credit score isn’t just about making timely payments or opening new credit accounts—it’s also about monitoring how your actions affect your score over time. Regularly tracking your credit allows you to see improvements, catch errors, and adjust your strategy if needed.

Start by checking your credit reports from all three major credit bureaus—Equifax, Experian, and TransUnion—at least once a year. You can do this for free at AnnualCreditReport.com. Reviewing your reports ensures that your payment history, balances, and account information are accurate. Errors, such as accounts that don’t belong to you, incorrect late payments, or outdated balances, can negatively impact your score if left uncorrected.

In addition to your credit reports, many banks and credit card issuers now provide free access to your credit score and insights into your credit utilization. Services like Credit Karma, Experian, and some credit card apps allow you to see how your secured credit card or other credit accounts are influencing your score in real time. Monitoring these updates can help you identify which actions—like paying down debt or making extra payments on a credit-builder loan—have the greatest effect.

Tracking your progress also allows you to spot trends in your credit use. For example, if your credit utilization suddenly spikes because of high balances, you can act quickly to pay them down before it significantly affects your credit score. Similarly, if you notice a late payment reported incorrectly, you can dispute it with the credit bureau to ensure your payment history is accurately reflected.

By actively monitoring your credit, you take control of your financial health. It’s a simple habit that can help you achieve a good credit score in a short period of time, prepare for larger financial goals, and maintain a positive relationship with lenders.