- Rebuild your credit with the right strategy.wallet and credit cards image by CraterValley Photo from Fotolia.com
If your credit is less than perfect, you might be able to repair some of the damage with the responsible use of credit cards. But even though this strategy is a sound one, caution is advised. Failing to take the proper precautions could leave you with a worse credit score, and additional credit card debt as well. - When rebuilding credit, it is best to limit yourself to one or two cards, rather than trying to accumulate an entire wallet full of plastic. It can be difficult to keep track of the due dates on multiple cards, and missing a single payment could hurt your credit score substantially. If you limit yourself to one or two cards, you can more easily keep track of the dates they are due, and that will reduce the chances that you will miss a payment inadvertently.
- Making your payments on time will help you rebuild your credit, but missing a payment, or paying late, could put you even further behind. In order to avoid this potential problem, be sure to set your reminders and mark your calendar with the date each card is due. Simply waiting for the credit card statement to arrive in the mail, or for the email reminder for your electronic payments, might not be good enough. Set a reminder on your email a week before the closing date on each card, then check the balance and be prepared to pay the card when it is due. You can also set up an automatic payment from your checking account, but be sure to watch your balance carefully to avoid bounced checks and overdraft fees -- a bounced check could hurt your credit just as much as a missed payment.
- When the credit card bill does arrive, do not simply put it on the pile of bills to be paid. Instead, pay the bill immediately, as soon as it arrives in the mail or lands in your email inbox. A history of on-time payments will help your credit and help you avoid late fees and other charges.
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