It’s a new year and it’s time to think about getting your finances in order.  Most people have been taught the same lessons when it comes to credit and what to buy and not to buy on credit.  I have written several posts on this issue, but just wanted to share a few tips to help you get on the right track for the new year.

1.)  Diversify your credit this year.

Take a look at your credit and figure out what type of accounts you are missing.  You should have a variety of accounts including an auto loan and different types of credit cards (gas, department store, major credit cards).

2.)  Check the available credit on your accounts.

The amount you owe on each one of your accounts affects your credit score.  If you have a credit limit that is $1000 and your balance owed is $895, then you need to work on paying down your debt on this account.  You need to keep all your credit lines at a 50% or lower margin from what your credit limit is as to what you owe.  ($1000 limit – $500 or less owed)  This will help to raise your credit scores and make you more credit worthy to creditors.

3.)  Pay your payments on time.

Be sure and pay your payments on time.  Even if you have had trouble in the past and have fallen behind on a few accounts, make a vow to yourself to get them caught up and pay them on time for the rest of the year.  You will be surprised at your credit rating after one year of on time payments.  There is no better time than the present to start fixing your credit.

4.)  Pay down your debt.

Work on paying down your credit cards this year.  Pay minimum payments on all your cards, but choose the one with the highest interest rate and pay more on it every month to get the balance brought down.  If you want to see fast results, pay off one of the smallest cards you have, it may give you the momentum to take on the bigger ones.

5.)  Credit Counseling.

If you are in need of credit counseling, contact a non-profit, accredited  organization to help you.  You can find one of these agencies through the Association of Independent Consumer Credit Counseling Agencies.

6.)  Leave your credit cards at home.

There is no temptation to use them when you leave your credit cards at home.  This will make you think about purchases and eliminate impulse purchases.  Decide whether you really need the item you are considering purchasing and realize how much that payment will effect you per month.

7.)  Interest rate check up.

Check your interest rates on all your credit accounts.  If you have several credit cards, chances are you have one or two with a higher interest rate.  Contact the credit company and ask for your interest rate to be lowered.  If you have paid your payments on time, they should be willing to do this.

8.)  Keep your head out of the sand.

So many times we all just bury a problem, even with our credit, and hope that it will go away or fix itself.  It won’t.  If you don’t tackle things head on, they will escalate until they get out of control.  It is best to keep up to date on what’s going on and just work at a steady pace to fix it, even if it is a little at a time.

9.)  Consider setting up online bill payments.

If you get paid on a regular schedule, consider setting up all your bills to be paid automatically when you get paid.  This will stop any late payments and your credit will be improving with each month.

10.)  Protect yourself and your good credit.

If you know you will not be opening any new accounts, you may consider freezing your credit.  This will stop all new accounts from being opened using your information.  As stated in previous posts, this is a great way to stop identity theft from becoming a reality in your life. 

Also, do not throw away any documents that may have your information on them.  Make it a practice to shred all incoming unwanted mail, bank statements, credit card statements, etc.  Be sure and use a criss cross cut shredder, as those make piecing items back together a mere impossibility. 

Last but not least, do not give out your information to anyone!  Identity theives are getting smarter everyday and coming up with new ways to steal your good name.  There have even been emails circulating with actual bank logos on them asking people to confirm their information.  Do not fall prey to this!  Your bank will NEVER ask you for your information unless you call them or go to the branch in person.  When in doubt, don’t give out any information on you, your spouse, children, etc.  You can never be to careful.