When it comes to improving your credit, most people have heard the standard advice. Being told to pay your bills on time is not exactly advice that I need to hear if I am struggling with credit issues. That much is obvious. Here are five unusual ways to improve your credit instead:
Budget Your Mistakes
No matter how solid your budget might be and how prepared you feel, mistakes will happen. You will go over budget and you will come up short on occasion. If you figure these mistakes into your budget, you can have enough play to cover those situations. Set aside a mistake fund (call it what you want) in addition to your emergency fund. Roll it back into your emergency fund on months where it was not needed.
Make your Emergency Fund Tough to Get
If you have to work hard to get your money, you generally won’t do it for things that are not truly emergencies. Put the money in a market fund or some other option to make money. If you put it under the mattress, so to speak, you will spend it far too easily.
Pay Attention to Your Budget as You Go
Most people make a budget and then try to balance it at the end of the month when the bills come due. Guess what? If you are spending wrong and made a mistake, it is usually too late by the end of the month. Watch your spending throughout the month to give yourself time to adjust on the fly to mistakes or overspending.
Eliminate Those Bills In Striking Distance
When a bill is so close to being paid off that you can taste it, go ahead and get that win when you can. Don’t however, do so when you have to invade other parts of your budget to do it. The only time that would make sense is when you are paying a very high interest rate.
Actually Watch Your Credit Report
You would be shocked at how many people never look at their credit report. Then, when they go to get a mortgage or car, they are shocked at the mistakes all over it. Credit reporting mistakes are common enough that you should be paying close attention at all times. If necessary, pay a credit monitoring agency to let you know when changes are made. Most of all, pay attention!
These are some unusual ideas to improve your credit, but you could spend an entire afternoon coming up with others. Credit is something that is worth brainstorming about. You should pay close attention to what makes it go up and what makes it go down. The last thing you want to do is ignore it. Credit makes the financial world go around!