credit card

Guide to Building Credit in your Credit Card

After gaining approval for a credit card, it is crucial to utilize the card in such a way that it builds your credit score. Follow the below tips for boosting your score easily. You can also visit ikanobank.dk for learning how credit scores are evaluated

Be punctual with payments

This is the best thing you can do for your credit card. When it comes to determining your credit score, your payment history is the most important factor. If you want to achieve an excellent credit score, always make your payments on time. 

Monitor your FICO score

There are various types of credit scores but FICO scores are frequently utilized by lenders. Review your FICO score after several months to know you’re doing good. Few credit cards come with a FICO score tracker but if yours doesn’t, you can check it online free of cost.

 

Keep the purchases low

If you overspend the credit limit, it will be dangerous for your credit score. The basic rule of thumb is to not utilize more than 20% to 30% of the available credit limit. 

Request for a credit limit increase

After 9 to 12 months of charging the balance and paying them off, you can request the credit card issuer for an increase. If you gain the increase, it will be easier to keep your purchases below the recommended 20% to 30% rule.

Keep your credit account open

Your credit card should not be inactive for a long time. The majority of banks close a credit account if it is inactive for 6 months or more. Try to make small purchases through the credit card after every few months. This will guarantee that your card is active and is being reported to the big credit bureaus. A factor that influences the credit score is the average age of the account. Therefore, keep using your oldest credit accounts. This will increase your credit score.