Final answer:
To protect or raise your credit score, you should pay bills on time, avoid maxing out credit cards, protect your personal information with secure passwords, use anti-virus software, monitor your credit history, notify banks of personal information changes, and pay off credit card balances quickly to minimize interest charges.
Step-by-step explanation:
Ways to Protect or Raise Your Credit Score
Protecting and raising your credit score is crucial for financial health. Here are some ways you can protect or raise your score:
- Make all your bill payments on time, as timely payments are a significant factor in calculating your credit score.
- Avoid maxing out your credit cards; instead, use a modest portion of the credit available to you to keep your credit utilization low.
- Set up passwords and PINs that are not easily guessed to protect your credit and debit cards, reducing the risk of fraudulent charges that could hurt your score.
- Install anti-virus software on your computer to prevent theft of personal information that could lead to identity theft and damage your credit score.
- Regularly monitor your credit history for any signs of identity theft or errors.
- Contact your bank promptly if you change your address or phone number to avoid missing bills or important notifications.
- When using credit, plan to pay off balances quickly to minimize interest charges, as carrying a large balance can negatively affect your credit score.
Developing a good credit history and credit score is important because it influences the interest rates you may receive on loans. A good credit history implies reliability in repaying loans, which can lead to more favorable interest rates.