Tips for maintaining a good credit score

Maintaining a good credit score is important for getting loans and credit cards. A higher score can help you secure better terms and lower interest rates. If your credit score is below 650, it’s time to take action. Here are five tips to improve your score. First, always pay your bills on time. This means making sure to settle all your dues by the deadline. If you occasionally pay the minimum amount, try not to make this a habit. Missing payments can hurt your credit score significantly. Second, monitor your credit utilization ratio (CUR). Keep it under 30 percent. CUR is the amount of credit you use compared to your total credit limit. For example, if your limit is ₹ 10 lakh and you use ₹ 4 lakh, your CUR is 40 percent. Reducing your spending can help maintain a better score. Third, consider having multiple credit cards. Having more cards can increase your total credit limit. This can help you stay within the recommended CUR, improving your chances of a better credit score. Fourth, only borrow what you need. Taking out larger loans can be risky if you have trouble repaying them. This can also affect your ability to borrow in the future. Lastly, maintain a diverse credit mix. This includes different types of loans, such as secured and unsecured loans, as well as credit card debt. A balanced mix can positively impact your credit score. By following these tips, you can work towards maintaining a healthy credit score.