Editor’s Note: This blog was originally published in February 2022 and updated in March 2025 with new information and links to additional helpful articles.
Say the word, ‘credit,’ and most people cringe. Yet, your credit score is one of the most important numbers in your life. It signals to the financial world how reliable you are. Therefore, improving your credit score is crucial for maintaining your overall financial well-being.
Your FICO credit score is a numerical representation of your creditworthiness based on your credit history. It’s a number lenders use to help them determine how likely it’s that they will be repaid on time. People with higher credit scores tend to have lower credit risk.
Use these four tips to start your journey.
1. Maintain a positive payment history.
Keeping all open accounts current and paid in a timely manner will help highlight your current credit management skills. Your payment history makes up 35 percent of your FICO score calculation.* The longer your credit history, the more credible you’ll appear.
2. Keep your credit balances low without closing the accounts.
Maintaining a low balance on your revolving accounts, such as credit cards or lines of credit, is a positive on your credit report. This is a straightforward way to boost your credit score.
For example, if you have a credit card with a $1,000 limit and a current balance of $900, it means you have only 10 percent of your available credit remaining. The general rule of thumb is to keep your available credit at 70 percent or higher. People with the best credit scores typically use only around eight percent of their available credit.
Your length of credit history, or how long you have had credit, comprises 15 percent of your FICO score.**Therefore, you should not close your older credit cards.** Even if you don’t use them, it’s good to keep them active. One way to do so is to charge a small recurring subscription, such as Hulu or Netflix, to a card and pay it off each month with autopay.
3. Manage your [credit card] accounts wisely.
Avoid opening too many credit cards to provide temporary score dips from hard inquiries, and keep older, well-managed accounts active to extend your credit history.
4. Review your credit frequently.
Regularly, checking your credit history and credit scores can help you better understand your current credit situation. Additionally, it can help you identify and correct inaccurate information. Requesting copies does not harm your credit score and could help you see opportunities to boost your score immediately.
Everyone’s credit score is unique to them. For example, scores for someone with a short credit history will be calculated differently than those with a longer credit history.
Follow these tips to get your credit score back on track. If you understand and monitor your credit activity, you’ll stay on the path to a successful financial future.
Check out our other blogs for more helpful credit and financial tips:
- Get Smart About Credit
- Why Good Credit is Important
- How to Finance a Car at Car-Mart When You Have Bad Credit
- Take Charge of Your Financial Wellness: Tips for Success
- Four Easy Steps to Car Buying and Financing at America’s Car-Mart
Get pre-qualified for a quality, used vehicle at America’s Car-Mart.
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