Credit Building and its maintenance are vital in today’s world. Most of you know this. But did you know, that a good credit score will also help you when applying for life insurance? According to the server Experian.com 67% of Americans have a “Good” Fico score or better. A Good score starts at 670. Where do you stand?

Major Factors Effecting Your Score

There are many factors that get included in your score. No one really knows the exact formula, other than the credit companies. However, there are three factors with a major impact to your credit score. If you are in the 400s or 500s, it means that you have no credit history, or you have a major issue in you credit report. This means you have a debt or a collection. Depending on the extent, this should be one of your first things to focus on. Paying it off or making payment arrangements is the way to go for you. The other two factors are payment history and credit to loan ratio.

There is a fourth big one, but unless you take care of the first one, you will not be able to move forward with it. It is called credit age. The longer you hold a credit card the better. But this is something that takes time and can’t really be sped up in any way.

Paying Off Debt

In most cases you know how much you owe and to whom. But, if you do not know, you can just get a free credit report and it will list it. You are entitled to one free credit report once a year. Once you get this report, you negotiate the fastest way to lower your debt. Even if you start paying of a few dollars each month, you’re still moving forward. And your credit score will increase as your amount of debt lowers. This step is so vital, we couldn’t stress it enough. Once you get this aspect under control, you’re ready to move forward.

Credit Building Credit Cards

With lower credit score, i.e. around 500, your best bet is store cards. Kohl’s for example can be a good starter for you. There are also many so called credit building credit cards. These will generally cost you an annual fee and the worst of then will ask you to secure the card and pay and annual fee. This means you pay the credit company money and also interest fee on the money you lend to them. Since there are many credit card options out there, you must shop around. You can get decent credit line for a few dollars. However, you can also be easily taken for a ride.

Credit Building Loans

If you’re paying off your debts, but still can’t get a credit card, then you may want to take a look at Credit Building Loans. This is something that is quite inexpensive and requires no credit check. The company sets up a CD for you with a target amount you agree to based on what you can afford. This is perceived as a loan. You pay off this loan through monthly installments. Each month the company reports to the credit bureaus. This shows your ability to make steady, long term payments. It builds your reputation. One of these companies is Self.

. In addition, they offer hundreds of other useful credit building tips. Definitely worth your attention.