Credit scores run on a scale of 300 to 850 — and as far as creditors are concerned, the higher your score, the better. My score recently hit 825, which is close to the highest score you can get. This credit score makes it easy for me to gain access to credit when I need it, but my score wasn’t always so great — or good, for that matter.
It took years of hard work and smart spending to earn an excellent credit score, and here are some of the steps I took to get there.
Where I started
When I graduated from college, I had a credit score in the mid-600s. I had opened a few too many credit cards in college, and because I had difficulty juggling them, I'd made a late payment that dragged my score down.
When I was applying for law school, I wasn't able to qualify for loans on my own, in part because of my low credit score and also because of my lack of income. I had to ask my parents to cosign my loans, and that was the tipping point for me. I vowed to start working on improving my credit so I wouldn’t have to face this issue again.
I had a long way to go to get from the mid-600's to an 800+ credit score, so I started researching exactly what I needed to do to boost my score. I also started checking my credit once a month to monitor my progress and see what caused my score to rise and fall.
My score rose quickly over the next few years and jumped up big time when the late payment dropped off my credit report. In the end, it took me just over seven years to get from a score in the mid-600s up to my current score of 825.
How I earned an 825 credit score
Here are some of the key things I did to earn my high credit score.
Keeping my old credit cards active
The length of your credit history is one factor that determines your credit score, so I made sure my credit history was as long as possible. This meant keeping old credit cards active even though I didn't really need them any more.
I've had several credit cards since college, which means my credit history goes back close to 20 years. I make a point to use them occasionally so they won't get closed due to inactivity. And because they go back far, they show lenders I can be responsible with credit over the long-term.
Setting up automated payments
After making a late payment because I couldn't handle all the cards I had open, I vowed never to make such a mistake again. I've set up automated payments to ensure I always pay my bills on time.
I pay my cards off in full each month via these automated payments and keep a cushion in my checking account. This way, an unexpectedly large bill won't accidentally cause me to overdraft my bank account.
When I was younger and living paycheck to paycheck, I set up automated payments for the minimum balance and manually paid the rest of the bill each month. That way, I could always make sure I wasn't late without running the risk of too much money being taken out of my account without planning ahead for it.
Taking out a few different kinds of loans
One other factor that affects your credit score is the types of credit you have. For me, this includes revolving lines of credit like credit cards, as well as installment loans paid back on a fixed schedule.
Over time, I've not only maintained my credit lines on my credit cards but I've also taken out a mortgage loan, student loans, and auto loans — all of which are installment loans.
As I've acquired and made payments on this debt, I've raised my credit score by showing I can be responsible with all different credit types.
Requesting regular increases to my existing lines of credit
Applying for new credit results in inquiries on your credit report, and too many inquiries can lower your credit score. I've avoided opening lots of new credit cards because of this. But at the same time, having larger lines of credit can help raise your score because it reduces your credit utilization ratio.
I've been able to get very high credit limits and a very low credit utilization ratio without applying for many new credit cards by regularly requesting credit line increases from my existing creditors. Every time the option to request a credit line increase shows up when I sign into my online account, I click it and request that my credit line be made a few thousand dollars higher.
The result? Very large credit lines without opening any new cards. Now, even when I charge a lot on my cards, I use less than 30% of the amount of credit I have available, which helps keep my score high. Of course, I do pay off my bill in full but since I charge everything and my creditors report my balance before it's paid off, having high credit lines is extremely important.
Another way to boost your score
In addition to the steps I've taken to raise my score, you can also do other things to boost your credit.
One option is to get added as an authorized user to a credit card that has a long history of on-time payments. The positive credit history from that account will show up on your credit record and help to raise your score. If you have a parent or older relative with a card that's been in good standing for a long time, consider asking if they'd be willing to add you to their account.
Being added as an authorized user is one way to raise your credit score fast. I didn't take advantage of this because I had time to increase my score while I was in law school before I needed to take out any big loans such as a mortgage.
If you’ve had credit issues in the past and are committed to improving your score, you can also apply for a secured credit card. These cards allow you to put down a security deposit, and you can spend up to that limit. As you pay your balance, the card issuer reports your activity to the three credit bureaus. Making regular payments in full can result in a boost to your credit score over time.
Bottom line: Raising your credit score is doable
My score has gone up a lot over the years. And anyone can follow the same path as I did. It just takes a few simple steps such as diversifying your credit history, learning how to manage your money and always paying your bills on schedule. Make a commitment to building better credit — you won’t regret it!