Improve Your Credit Score: 4 Actionable Steps for 2024

These could be your ticket to a higher credit score -- and more borrowing options.

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Key points

• A higher credit score could make borrowing more accessible and affordable.
• There are steps you can take to boost your credit, and a few are really easy.

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Many Americans have seen their credit score take a hit since the start of the pandemic. Between job loss and inflation, some consumers have fallen behind on their bills and racked up debt to make ends meet. But unfortunately, it's those circumstances that can result in credit score damage. If you're looking to boost your credit score this year, here are four moves you need to make.

1. Pay your bills on time

Paying the occasional bill late may seem like no big deal, but once you reach the point of being 90 days delinquent or more, it can cause extreme credit score damage. If you're looking to raise your credit score this year, make a point to pay every single bill on time.

If money is preventing you from doing that, you have a couple of choices. First, you could rework your budget and rethink your spending. Secondly, you could try boosting your income with a side hustle so you have enough cash to cover your expenses.

2. Whittle down your credit card balances

As long as you make your minimum credit card payments every month, you won't be flagged as late with those bills. But carrying a balance can still hurt your credit score.

When you use too much of your available credit limit, it can drag your score down. If you're currently carrying a balance that equals 30% or more of your total credit limit, you can raise your score by chipping away at that debt.

As is the case with being on time with bills, rethinking your spending -- and cutting back in some areas -- could help free up money to pay down your debt. Getting a side hustle could do the same.

3. Ask for a credit limit increase

If you want to get your credit utilization to 30% or less, you have two choices -- you can pay off some existing debt, or you can get your credit limit raised. If you can't easily do the former, you may be able to easily do the latter.

All you need to do is contact your credit card companies and ask for a higher spending limit. They're likely to agree if you've been a cardholder in good standing for several years, or if you can show proof of a higher income than you had when you first applied for your cards.

That said, if you're going to ask for a credit limit increase, do your best to not actually use it. If you do, you could end up getting stuck where you are credit score-wise.

4. Review your credit report for errors

You never know when a credit report mistake could be dragging your score down. In 2021, Consumer Reports found that more than one-third of Americans had an error on a credit report, so you can't assume yours doesn't have one as well.

The good news is that credit reports are free on a weekly basis through April, so you have plenty of opportunities to pull yours and review them thoroughly. If you've never checked your credit report before, be sure to access a copy from each of the three major reporting bureaus -- Experian, Equifax, and TransUnion.

A higher credit score could make it easier to borrow money the next time you need to. Just as importantly, you're more likely to snag a more favorable interest rate on a loan with better credit, which can make borrowing more affordable. These four tips could help you raise your credit score in 2022, so start mapping out your personal plan to boost that number as quickly as possible.