How to Build Up Your Credit

building blocks of credit

Whether you have good credit, bad credit, or no credit to your name at all, the good news is that it’s never too late to build up your credit or turn the tide if your credit score is low.

Establishing a strong credit history and cultivating a good credit score can significantly impact your life by helping you secure things like credit cards, loans, and a mortgage. Staying on top of your credit health is critical to ensuring long-term financial stability.

Let’s take a look at how to build up your credit and maintain good credit for years to come.

3 Ways to Build Your Credit

1. Become an authorized user

Becoming an authorized user on someone else’s credit card, such as a parent, spouse or family member, is an especially useful tip for those who don’t have much credit. Assuming the primary cardholder is making their payments on time, being an authorized user on the account will help build up your credit while not holding you responsible for paying off any purchases made on the card.

2. Get a credit card

If you don’t already have a credit card in your name, get one. Making payments on time every time and paying your balances off in full are great ways to build your credit, especially when starting from scratch. Your payment history makes up a big portion of your credit score, so making continuous on-time payments will give your credit a nice boost.

3. Get a co-signer for a loan

Another great way to build up your credit is by taking out a loan with a responsible co-signer who already has good credit. Having a co-signer simply means having someone who agrees to share responsibility for the loan if you are unable to pay your bills at any point. Just keep in mind that if you don’t make payments on time, your co-signer’s credit score will also suffer.

How to improve your existing credit score

Make your payments on time

Consistently making payments on time is the surest route to improved credit. This goes for all different types of credit: credit cards, personal loans, or some other debt source. Paying on time will not only prevent negative or delinquent accounts from being placed on your credit report, but will also decrease your utilization rate. This is an important factor when it comes to credit scores.

Don’t close credit cards

While it may be tempting to cut up unused credit cards and close the accounts, don’t. As long as there are no annual fees, keep the accounts open. Closing them can negatively impact your credit score because you would be losing the available credit you have on that account, which affects your credit utilization rate. The more available credit you have, the better. It’s also good to have a long credit history with a credit card.

Check for any errors on your credit reports

Your credit report is a huge indicator to lenders as to your financial stability, and according to the FTC, nearly 5% of them come with all kinds of errors and mistakes that can negatively impact your credit score. This could be a false credit card balance, incorrect payment status, or something else, so it’s worth checking. You can obtain a free credit report from each of the major credit bureaus: Equifax, Experian, and TransUnion.

Diversify your credit

Diversifying your credit means having various types of accounts to your name, such as credit cards, student loans, personal loans, a mortgage, automobile loans, etc. While you don’t want to take out a loan you don’t need, just keep in mind that having a mix in your credit will determine roughly 10% of your FICO score.

How to check your credit score

At this point, you may be wondering where you stand when it comes to your credit score and financial profile. It’s a good idea to check, especially if you plan on taking out a loan. It will help you get an idea of what you might qualify for.

There are a few ways to check your credit score. If you already have a credit card or loan in your name, your credit score may be present in your monthly statement or on your account online.

Another way to get your credit score is using an online credit score service. There are many websites offering a free credit score request. Some online websites, however, will charge a subscription fee for a “credit monitoring service” which will also provide you with your credit score.

Lastly, you can buy your credit score directly from credit reporting companies, such as which provides your FICO credit score.

Good habits to follow to maintain good credit

Building good credit doesn’t happen overnight. It’s a never-ending process that can take time. Here are some essential good habits you should establish and maintain to keep your score solid for years to come.

  • Pay your bills on time. Payment history is one of the most influential aspects of your credit score.
  • Keep a vigilant eye on your utilization ratio. Experts recommend using no more than 30% of the credit available on an account to show your responsibility in managing your credit.
  • Keep your balances low. Even if you’re making payments on time, it’s generally good to show control over your spending by keeping your debts as low as possible.
  • Be moderate in applying for credit cards. Applying for too many in a short period of time will add multiple “inquiries” to your credit report, which can make you look like a risky borrower.
  • Keep a mix of credit accounts. Having several revolving credit lines can help maintain your credit score.
  • Monitor your credit report and be alert to any potential errors or mistakes that can arise. If you find an inaccuracy, report it immediately to get it rectified.


It’s never too late to build up your credit and begin implementing good habits that will help your credit score grow. The key is to always stay on top of your credit. Even if you don’t need to take out a loan anytime soon, you want to be prepared for when you do by taking the necessary steps today that will strengthen your financial profile for the future.

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Jessica Cotzin Jessica Cotzin Last update:
Jessica Cotzin is a writer and the Lendstart authority on small businesses and personal loans. She has been writing about personal finance and the loans industry for a number of years, and holds a bachelor’s degree in journalism from Florida Atlantic University.