Your credit score is an important three-digit number that impacts your financial health significantly. From being eligible to take out a mortgage loan to purchase a new home, rent an apartment, or start a business, to access lower interest rates and more –your ability to achieve your financial goals all hinge on your credit score. Essentially, your rating is a number between 300 and 900. This score is calculated by using your credit history, how often you pay off your debts, how much debt you have, and more. The higher your score, the better it is for your financial health. With that being said, if your score falls into the lower range, or if you simply would like to optimize your credit score, you have complete control in doing so. Therefore, if you want to learn how to protect and improve your credit score.

Tips on how to protect your credit score

Remember, your credit score plays a significant role in your ability to thrive financially in life and achieve your personal goals. Therefore, to ensure that you protect your credit score at all costs, here are some tips on how to do so in more detail below:

Pay your monthly credit bill online

Late payments on your credit card can have a negative impact on the credit scoring system. Therefore, it can be beneficial to set up a scheduled monthly payment for at least the minimum amount owed to ensure you don't miss deadlines. Nonetheless, paying off your credit bills on time and ultimately continues to be the correct approach that will keep your credit score steady and improve it over time.

Pay off your debts quickly

If you have numerous credit cards with high debts on each, it is crucial to pay these off as quickly as possible, as leaving them unpaid can drastically damage your credit score and make you illegible to take out an additional loan in the future in case of emergencies.

Choose a credit card that benefits you and your living habits

Select a credit card that corresponds to your needs. For example, you might wish to search for credit cards with reward points rewards that you can utilize to make payments on your current balance or ones that offer an instalment option that enables you to disperse your payments at a reduced interest rate over time.

Keep an eye on your credit score

Believe it or not, many Canadians do not make it a habit of keeping an eye on their credit score. Use the numerous helpful resources that are available on the internet to devise the best approach for protecting your credit score. Alternatively, meet with your financial advisor for more information. And remember, your credit score can impact your life in many ways. Therefore, it is always best to be proactive when protecting your score at all times so you can work towards your personal and financial goals at any time in your life.