The three-digit number that could have a significant impact on your financial life is your credit score. The higher your score, the easier it will be for you to get a loan or a credit card. Hence, you must have a good credit score. Here are a few tips to improve a bad credit score.

• Pay your bills on time
  This is one of the most essential tips to improve a bad credit score. Banks and financial institutions are not going to lend you money if you do not have a good history of paying your debts on time. Late fees and penalties and paying less than required harms your credit score. Hence, paying credit card bills, auto loans, student loans, rent, and utilities on time is a good idea. You can set up reminders or automatic payment schedules to ensure that you do not miss a payment.
• Check your credit reports
  Another smart tip to improve a bad credit score is to check your credit reports for any incorrect or inaccurate details. Inaccuracies can affect your score, so checking and disputing any errors should help to spot these mistakes and prevent any damage to your score. You can get your credit report from credit reporting bureaus.
• Don’t close old unused credit card accounts
  The longer the history of your credit card account, the better it is as it gives a more detailed look of repayments and establishes reliability. If you are not paying too much in annual fees, it is better to let old unused credit cards be. If you need to close credit card accounts, start with the newer ones first.
• Contact your creditors
  If you are unable to pay your debts due to a change in financial status such as job loss, before the expiry of the deadline or due date, one of the tips to improve a bad credit score would be to talk to your creditors. This will help you put into place payment plans and avoid high outstanding balances and late fees, which can damage your credit score.
• Paying credit card bills
  If you have multiple credit cards, pay the amount outstanding on the ones that are maxed out or nearing the due date. This will help reduce your credit utilization rate.
• Don’t open new credit accounts
  Opening multiple credit accounts not only entices you to spend more and accumulates debt but also affects your credit score. Open new credit accounts only if you have to.

A good credit score helps you to secure the best rates and terms when applying for a loan. You might also find it easier to rent or lease a home with a good credit score. Following these tips to improve a bad credit score should help you.