5 Easy Habits I Used To Achieve An 800+ Credit Score

I recently crossed the exciting line of an 800 credit score. It’s exciting, but in reality nothing has changed. The habits used to reach this are extremely easy, and really are habitual processes that you can use in your FI journey.

A credit score is extremely beneficial in getting low mortgage and loan rates to further our FI goals, potentially with the help of real estate.

The 5 habits are:

Habit 1: Start your credit building early

I opened my first credit card just before I was 20 years old, while in college. It was a simple Chase Freedom card, and I was so excited. Credit history is a big deal as far as credit score factors are concerned, by starting earlier I was able to show I have history of a positive track record.

Habit 2: Pay in full every month

This is a habit I built to help with habit 4. I pay my credit card off every month in order to not get in over my head in debt. It is often that people will let their credit just sit and accumulate. This is the trap, and this is where those $5 (10-25% fees) start hitting you. On a percentage basis this is where you the card holder lose, and where the banks win.

Habit 3: Keep your credit accounts active

I buy at least 1 item on my credit cards every few months so that they stay active. They are my longest history accounts, so it’s important to keep them active. You will have some credit accounts closed as you pay off debt (ex: student loans), but as long as those aren’t your longest credit history account you’re in a good place.

Habit 4: Keep your utilization low

See habit #2. Keeping your utilization low prevents you from getting dinged. However, a good thing about the utilization metric is it rarely permanently dings you. I have seen cases where a specific credit account is maxed our on purpose for a reason, and then paid off a few weeks later, and the credit score took a temporary drop, but recovered to slightly higher than before levels once paid off.

Habit 5: Don’t open too many accounts unless necessary

You can get into a situation where you have too many credit accounts open. I’m not a credit expert, but I just watched my account volume with reasonable expectations. Things like, 20 accounts probably seems to high. 2 credit cards seems reasonable with different rewards so I can strategically earn perks.

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