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Credit has become such a big part of our lives. From buying a house or car to health insurance and employment background checks, bad credit can affect you in ways you may not even be aware of.

While improving your credit is important, it can seem overwhelming to those of us with financial hiccups in our past. But like all things, you can start out small and take the necessary steps to improve it in no time. Looking to improve yours this year? Follow these tips to get started.

Pull a free copy of your credit report.

Know where you stand with your credit now. Everyone is entitled to a free copy of their credit report every year. Pull yours so that you can see what is on it and if there are any corrections to be made, you can start that process now.

Work with creditors to clear up any past due accounts.

Past due (overdue) accounts really hurt your credit score. Clean these up now. Contact your creditors and set up payment plans if necessary and if you have the cash right now to work out a settlement agreement with that creditor, do it. Just be sure that you get the agreement in writing and that you have agreed on how the account will now be reporting on your credit report.

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Become an authorized user on an account in good standing.

In this case, you are not the credit card holder, but by submitting your social security number, you will get the benefit of the payment history associated with the card. You can do this with a parent or spouse and if kept in good standing, this account will help boost your credit score.

Start paying your bills on time.

This might seem pretty self-explanatory, but it really is about committing to doing it. Do not think you can skip a month or play catch up with paying your bills. It doesn’t work like that. Late payments are reported every month, so even missing one payment can hurt you in improving your credit. If you need help with this, automate your payments. Next tip….

Set it and forget it.

If you need a little help with paying bills on time, automate your payments. With this option, you will never be late (unless something unforeseen happens), you will maintain an accurate record of payments through the bank, and the worry about meeting due dates is now gone.

Understand that your credit report and bill payment is a reflection on how you handle your financial obligations and really, your life. If you have had a setback: job loss, divorce, illness etc. you may have a few dings, but with a little work and dedication, you can come out of it and enjoy the benefits of having good credit again.

Jennifer Streaks is a financial and lifestyle writer and a new contributor for Learn more about her at her website,, and follow her on twitter @JStreaks.


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