This content includes information from experts in their field and is fact-checked to ensure accuracy.We are committed to bringing you researched, expert-driven content to help you make more informed decisions as it pertains to all aspects of your daily life. We constantly strive to provide you with the best information possible.It's essential to monitor your credit score, but when it comes to improving it, the factors at play can be confusing.
"When you increase your credit limit but stick to the same spending habits, you effectively improve your credit utilization score," Kalmon notes."This significantly impacts your credit score because it reflects how much credit you use in comparison to how much is available to you .
"If you have a friend or family member with a high credit score, becoming an authorized user on one of their credit cards can help boost your credit score," says"It sounds counterintuitive to take on more debt, but there are certain situations when it makes sense," Brault says."For example, if you are carrying a large balance on your credit card but are making all the payments, this may impact your score, but you are also still a trustworthy borrower.
In this case, even you're using the card, there is no balance increase and no impact on utilization."Basically, it is using credit for cash transactions just to increase a credit score," he says.It can be tempting to close credit cards that you don't use as much or those that are collecting dust in the back of your wallet. But Brault advises against this, as these mature credit cards play a bigger role than you may realize.
He explains this is because FICO scoring is heavily skewed to revolving debt."The utilization and payment patterns of these accounts will exert more influence than the payment pattern of a fixed-term loan that has always been paid on time," he said.