Clean up your credit

Paying with Debit CardIt’s not uncommon. Perhaps you had a hard time finding a job when you graduated from school. Perhaps you had to get out of a bad relationship, regardless of the financial consequences. Or maybe you bit off more than you could chew, financially speaking.

Regardless, there are loads of people out there who, for whatever reason have damaged their credit. That was then and this is now. If you are seriously about righting the wrongs of your credit past, here are a few steps to take.

Know what you are up against

Get a copy of your credit report and determine both the depth and the length of your credit mistakes. One you know exactly what you are dealing with, you can formulate a plan to rectify them moving forward.

Cut down on the cards

If you have multiple cards, close them except for one (preferably the one with the lowest interest rate). Less cards to manage means that you can focus on your task at hand in a responsible fashion.

Rigid Commitment

Most likely your credit trouble were from late payments. Make sure you make your payments on time. Every time.

Don’t wait for the bill to come to you. Mark your calendar with a set date, well in advance of the payment due date to check in with your card(s) to make sure things are done on time.

Small purchases

Wherever possible, commit to a cash lifestyle in order to keep the debt load under control. If you are using your cards, make sure you can pay off what you charge in full every month. More debt means more interest- which may make it harder for you to pay your debts in a timely fashion every month.

Watch the limit

One lesser known fact: having your cards maxed out will lower your credit score. While you are in the process of trying to rebuild your credit, make sure that there is a sizeable gap between your balance and the limit.