Last year I got my foot on the property ladder by obtaining my first mortgage, so having a good credit score was absolutely crucial but I didn’t know this before then.
Money. It’s something we all use every single day. We need money to pay bills, support ourselves and also to treat ourselves and others every now and again. So why are we not speaking about it more?
I haven’t always been sensible with money, but when I was 18 I got my very first Topshop store card. This could have been very dangerous, but I was in a full-time job and studying hard. So the fees got paid, and I was able to gain myself a very good credit score. I didn’t know I was doing this at the time. I just believed I was paying off a debt that would simply be forgotten about.
I have also had an overdraft with my bank, and this was something that was paid off monthly. I had to take an overdraft out at the time to pay for unexpected bills that popped up due to cars and lifestyle expenses (lifestyle can be anything from my expensive foundation that I treat myself to or buying my partner an extra special present for his 36th birthday – this). I was able to pay the overdraft off within a couple of months, and the credit score then went up. Little to my knowledge at the time…
I have also had a small loan to ensure that an unexpected holiday could be paid off. Again, this was paid off a year later and the credit score went up some more.
So how can you get a good credit score?
- Try and keep on top of your expected finances by understanding what is coming in and what is coming out. We can’t always know as unexpected things do happen, such as a blown tyre or oven.
- Understanding what is meant by ‘bad credit’. If you are scared of the words ‘credit cards’ and ‘loans’ then don’t be. Cash Lady have a great piece that helps you know where to turn to if you are in need of a bit more financial stability. Try and spend sensibly. Don’t always say YES to the first thing that crops up. Look around and invest in something that will help you get to the places you need to be financially. Don’t dig yourself into a stressful situation.
- Finally, be realistic. Gaining a good credit score happens through paying off credit on-time and the right amount. Don’t take a loan out for £1000 when all you needed was £100. Stay sensible and you will come out with a greater score than before.
I hope this helped others in understanding how to gain a good credit rating, and to talk a bit more openly with family and friends about money. Don’t live in fear anymore!