7 Ways to Boost Your Credit Score

This post is by Silicon Valley Blogger, who writes for The Digerati Life, a personal finance site that covers a wide range of topics in the areas of money management, finance and business.

From getting a mortgage to securing a good job, your credit score matters. You want to boost your credit score to qualify for low interest loans and topnotch jobs, so consider these tips to help you raise your credit score.

#1 Know What Your Credit Score Is

Start out by knowing what your credit score actually is by verifying it through the three major credit bureaus: Transunion, Equifax and Experian. Perform these regular checks as an old credit score might be inaccurate. Besides checking your FICO credit score information, you are also entitled to one free credit report per year. It's essential to get a new credit report annually to remain apprised of your status found in public records.

#2 Really Look At Your Credit Report

Don't just check out your credit score and run. Pore through and review your report carefully to verify the accuracy of your personal information, such as your name, address and work history. You want to be sure that your file hasn't been compromised in any way. Double check to make sure that your accounts are accurate and without error. If there are any mistakes, take note of those discrepancies.

#3 Fix Errors On Your Credit Report

If you find mistakes on your credit report, write a letter outlining the errors to the credit bureau. By law, you are entitled to receive a response from the agency within 30 days. This is a quick fix for easy errors, but note that difficult mistakes require additional legwork. If a debt does not belong to you, then pursue the dispute. If need be, contact your creditors directly and discuss your situation. Once you report an error, you have 60 days to get the creditor to correct the situation. If you are still dissatisfied, request an additional investigation from the credit reporting agency.

#4 Know When To Hold Them And When To Fold Them

In the words of an old song, you need to know when to fold them. Disputing a small bill might wind up negatively impacting your credit score. For example, it might be worth paying a $20 debt rather than fighting endlessly about its validity. Note that as long as your credit score is negatively impacted, you won't qualify for lower interest credit cards and viable mortgage loans.

#5 Never Use All Your Credit

Using up all your credit is tempting but lowers your credit score. It makes it look like you need all that credit. For the best credit score possible, see if you can limit your credit use to up to 20% of your credit. Make sure to pay all your bills on time to show your sensible financial planning. And instead of canceling credit cards or closing down your card accounts, simply don't use them. When you cancel your cards, your available credit is reduced, which could lower your credit score.

#6 Don't Pay With Cash All the Time

While you can't go wrong with carrying cash, think about using your credit cards once in a while in order to build your credit history. When you have no credit history, your credit score falters. It's a good idea to pay for small items with your credit card and clear up the bill right away as this will help establish your credit. Try to keep your debt manageable so that you can pay your bills in full each month. Know when to use cash instead of your credit card, particularly if you are living on a budget and your cash flow is limited.

#7 Pay Your Bills on Time

Don't pay your bills late -- none of your creditors will appreciate hearing about your troubles. If you end up with consistently late or returned payments, your credit score will be compromised. Be on time or pay your bills in advance in order to maximize your credit score. You can expect your credit score to show improvements if you pay your total credit card bill each month and establish a track record as a good credit card customer. If you take care of your credit, you'll look really great on paper.

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