# How to improve your credit score Achieving a good credit score should not be an intimidating prospect. If your score isn’t where you want it to be, you can work to improve it. You can take some simple steps that can help build your score enough to get better interest rates on credit cards, make it easier to qualify for loans, and save money in insurance premiums, among other things. ## Get your free credit score Start today. The sooner you know your baseline score, the sooner you can start to build credit history. [Get started for FREE](https://secured.creditsesame.com/oneClickSignup) ## How credit scores are calculated The average FICO [credit score](https://www.creditsesame.com/blog/credit/counter-economic-threats-by-working-on-your-credit-score/) was 714 in 2021, according to data from [Experian](https://www.experian.com/blogs/ask-experian/what-is-the-average-credit-score-in-the-u-s/), one of the three major credit bureaus. FICO is the most widely used credit score in the United States, ranging from 300 to 850. A 714 score is considered good. Knowing how credit scores are calculated can help you decide which areas you can work on to raise your score. Here are the main factors that go into computing credit scores, along with ways to improve your score in each area: ###### Payment history Paying your bills regularly on time is the best way to improve your credit score. It accounts for 35% of a FICO score, so late or missed payments can hurt your score more than any other one action. ###### Amount owed How much money you owe at any one time across your lines of credit is the second-biggest factor in a credit score, accounting for 30% of a FICO score. It’s best to pay off all of your balances every month if you can. ###### Credit utilization Credit utilization shows how much you’re using the credit available to you. It’s calculated by dividing the amount of revolving credit you use by your total available credit across those accounts. A good goal is to use less than 30% of your available credit. ###### Credit age Credit age is a record of how long you’ve had established lines of credit. The longer your credit age, the better. ###### Credit mix A variety of account types helps show lenders you know the fundamentals of credit, especially if you manage all of them well. ###### New credit Getting a new credit card can lower your credit score temporarily. Too many hard inquiries can cause a credit score to fall. ## How improving your credit can improve your life Improving your credit score can make a lot of things a lot cheaper. Low-interest rates are often given to people with the best credit scores, making auto, home, and other types of loans less expensive over years of payments. ## How to take steps to improve your credit You should be able to use the list above on how credit scores are calculated to change your money habits and improve your score. Here are some specific ways to follow those rules and raise your score more: ###### Pay bills on time or early Automatic payments and reminder alerts when your bills are due are two easy ways to pay your bills on time. ###### Review credit reports Get your credit reports for free each year from each of the three consumer reporting agencies — Equifax, Experian, and TransUnion. Check for errors and signs of identity theft and fraud and dispute any mistakes you find. ###### Watch your credit utilization rate Use less of your credit limit, such as 10%. ###### Limit new accounts Too many credit inquiries can lower your score. ###### Keep old accounts open Keeping old accounts that don’t charge fees can help your credit history remain long. ###### Become an authorized user This can help establish a credit history more quickly. ###### Fix credit report errors Inaccurate, incomplete, or unverifiable information must be removed or corrected, usually within 30 days. ## How long does it take to improve your credit? Expecting your credit score to go up overnight is unrealistic. Work and patience are required to solve many credit report issues. ## How do you build credit? If you’re young or new to credit, building credit can seem difficult. Here are a few ways to consider: ###### Secured credit cards A secured credit card requires depositing money that’s equal to the credit limit on the card. ###### Student credit cards A steady income from at least a part-time job and proof that you’re enrolled in school are the main requirements for getting a student credit card. ###### Co-signer A co-signer can help you qualify for better loan terms. ###### Rent and utility payments Ask your landlord and utility companies to report your payments to the credit reporting agencies. ###### Self-report banking data Programs like UltraFICO allow consumers to improve a thin credit profile by self-reporting their banking information. # See your FREE score 100% Free. No credit card. No trials. [Get started for FREE](https://secured.creditsesame.com/oneClickSignup) ### In a nutshell Improving your credit requires time and patience. By knowing the main factors that go into a credit score, you should be able to start financial habits that can raise a score. Paying your bills on time is the biggest step, so start with that if you can.