Tired of your credit score holding you back? Take these steps now to start improving your credit.

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Is your credit score holding you back from getting approved for credit cards and loans with low interest rates? Maybe you already have a decent score but would like to increase it so you can get a better interest rate on a new car loan, mortgage or credit card with a lucrative rewards program.

Whatever your reasons, improving your credit score is easier than you think. And there’s more good news: The passage of time can work in your favor when it comes to old accounts that knock down your score. Want to bump your credit score to the next level in 2022? Here’s how to get started.

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What’s a good credit score?

Not sure where your credit lands on the poor-to-excellent rating? Here’s a rundown of the range of credit scores calculated by the Fair Isaac Corporation (FICO) and used by many lenders and credit card companies:

  • Poor: Lower than 580
  • Fair: 580 to 669
  • Good: 670 to 739
  • Very good: 740 to 799
  • Exceptional: 800+

The higher your credit score, the more likely you are to get approved for credit cards with better benefits and rewards programs. With a very good or exceptional score, you may also be able to get auto and mortgage loans with lucrative interest rates that save hundreds, thousands or tens of thousands (on a mortgage loan) on how much you’ll pay over time.

Ready to get started? Here are five steps you can take to get your credit score where you want it to be.

1. Review your credit report

To start working on improving your score, you’ll need to know where you stand. You can order one free copy of your credit report every week through April 20, 2022, at AnnualCreditReport.com. You won’t need to look at your credit report every week. However, reviewing a new copy every three to six months while trying to improve your score is a good idea.

For help deciphering what all those accounts and remarks on your credit report mean, first take a look at an online guide on how to read your credit report. Then look for delinquent accounts, late payment history, collection accounts and other factors that are keeping your score low.

Find out: How to Improve Your Credit Score Step-by-Step

2. Correct any errors

While you’re at it, make sure your name and current and previous addresses are correct. Also look for unfamiliar accounts, which could signal identity theft. If you see errors or an account you don’t recognize, contact the credit bureau reporting it to correct the mistake or investigate the unfamiliar account.

Find out: Take These 7 Steps to Dispute Credit Report Information

3. Reduce credit card debt

Did you know that how much credit card debt you have can lower your credit score? That’s because your credit utilization rate — the percentage of revolving debt you have to available credit — accounts for about 30 percent of your total score. To help raise your score, pay credit card balances down.

Ideally, your credit utilization rate should be below 30 percent. For example, if you have $15,000 in available credit on all your credit cards, your total credit card balances should be less than $4,500. Reducing that amount even more will also have a positive impact on your credit score.

Find out: How to Reduce Credit Card Debt in 5 Steps

4. Make all payments on time

Payment history is the biggest factor in your credit score calculation, accounting for 35 percent of the total score. So, if payment history is dragging down your score, making all payments on time will likely improve your credit. It may take time, since late payment information stays on your credit report for up to seven years or up to seven or ten years when you file bankruptcy.

That may sound like a long time, but think about it. Some old accounts may have already been on your credit report for years. As each negative payment history drops off after seven years, your score should gradually improve — as long as you keep making timely payments on other accounts.

Find out: Ways to Build Credit After Filing Bankruptcy

5. Keep older accounts open

If you have an old credit card account that you never use, don’t close the account. That card’s credit limit and zero balance and credit limit work in your favor when it comes to your credit utilization ratio. To make sure the credit card issuer doesn’t lower your credit limit for non-use, charge a small item every six months to a year and then pay it off with the next statement.

Find out: 5 Factors That Can Lower Your Credit Score

How a higher credit score can improve your life

Raising your credit score in 2022 may seem like a lofty goal, but once you’re committed, you’ll probably notice slight increases over time. Keep at it. Once you have a good-to-exceptional (excellent) credit score, you’ll receive better interest rates on loans and credit cards and qualify for superior credit card rewards programs.

Find out: 7 Ways Fixing Bad Credit Can Improve Your Life

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About the Author

Deb Hipp

Deb Hipp

Deb Hipp is a full-time freelance writer based in Kansas City, Mo. Deb went from being unable to get approved for a credit card or loan 20 years ago to having excellent credit today and becoming a homeowner. Deb learned her lessons about money the hard way. Now she wants to share them to help you pay down debt, fix your credit and quit being broke all the time. Deb's personal finance and credit articles have been published at Credit Karma and The Huffington Post.

Published by Debt.com, LLC