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Follow the 12-Month Strategy to Boost Your Credit Score In 2020

IndianMoney.com Research Team | Posted On Friday, December 20,2019, 05:40 PM

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Follow the 12-Month Strategy to Boost Your Credit Score In 2020

 

 

If your financial life is messed and you want to take control of it, then you must know the 12-month strategy to uplift your finances in 2020. You can also use this strategy if you have suffered from poor credit score in 2019:

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Follow the 12-Month Strategy to Boost Your Credit Score In 2020

A little bit about Credit Scores:

  • Your credit score is a summary of your repayments and your financial behaviour and over the past few years
  • A Credit score is an important factor when it comes to availing loans. Lenders prefer individuals with a higher credit score as they are more likely to repay their debt on time.
  • Banks and NBFCs reject loan applications or give loans at high-interest rate if your credit score is low.
  • A credit score of 750 and above is considered good by most banks and financial institutions.
  • A high credit score gives you an upper hand in negotiating the terms of your loan. you may also secure a credit card easily if you have a high credit score.

See Also: Credit Score India

Is it possible to improve your Credit Score?

Yes, it is possible to improve your credit score. But you must keep in mind that this is a slow process and one cannot improve credit score overnight. In order to improve your credit score, you have to regularly pay your bills and loan EMIs within their due dates. Missing payments may further damage your credit score.

See Also: CIBIL Score Report - How to Check Your Credit Score Online?

Remember a low credit score is the result of irregular repayment history over the years. The only way you can improve your credit score is by being disciplined and repaying your bills responsibly. Thus, if you are currently having a low credit score and you are looking for ways to boost your score, then here is a 12-month plan for you. By following this you can manage your debts and boost your credit score at the same time.

Let’s get started on our 12-month strategy:

January to March:

Checking Your Credit Reports:

In the first three months, your primary job will be to prepare an effective credit transformation plan. an effective credit improvement plan will give you a clear understanding of where you are currently standing in terms of your finance. Thoroughly check your credit score and credit history. If you find any errors or questionable entries then list them down.

See Also: Check Credit Score Online

Disputing Errors in Your Credit Report:

Once you discover those errors in your credit report you must immediately raise a dispute with the credit institutions. Incorrect entries may impact your credit score negatively. You can raise disputes without having to pay any charge. You may also contact a reputable credit dispute company to carry out the process on your behalf.

Automate Your Bill Payment:

Set your payments to account on an automatic bill payment mode to maintain regularity in bill payments for your monthly obligations. We often forget to make payments on time resulting in our credit score getting affected.

April to June:

Tackle your Credit Card Debt:

If you have credit card debt make sure you pay it off before availing a new debt on your credit card. This will ease your finances and boost your credit score. Keep track of your credit card spends and keep your credit utilization ratio below 30% of your credit limit.

See Also: Cibil Score For Credit Card

Time For A Progress Check:

It’s time to review your progress report. This will give you an understanding of how your credit behaviour has affected your credit score.

Creating New Credit:

Depending on the situation you are currently in, it may prove to be beneficial to establish new credit. If you have no current credit account then this step can be worth considering. You may avail a secure credit card or a loan to help your credit score improve over time.

See Also: Free Credit Score

July to September:

Track Your Progress:

Now that you have already crossed half of the year, it’s time to review your progress again. It’s time again to check whether your efforts are helping you or not. This is the time when you can implement new strategies if your past strategies have not helped you much.

Consider Taking A Balance Transfer:

Evaluate the amount of your debt you still owe. If you still have considerable debt then it is a little difficult to achieve a good credit score. 

In such a scenario, you may consider consolidating your debt under a personal loan. A personal loan balance transfer is a great way to pay off your existing debt at an affordable interest rate. With this option, you can pay your debt faster and save considerable money that you would otherwise pay as interest.

October to December:

Review Your Development And Celebrate Your Victory:

The final months of the year are crucial and you must keep track of your credit score and credit report to understand your progress. You must incorporate the habit of regularly checking your credit report in your life and carry it into the future as well.

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