How to Improve Your Credit Score Quickly: A Comprehensive Guide with Apps

For many of us, achieving financial independence is a key goal, and one of the biggest hurdles in that journey is managing our credit score. As young professionals, we need to be aware of how critical a good credit score is for securing lower interest rates on loans, getting approved for credit cards, or even renting an apartment.

In this detailed guide, I’ll walk you through how to improve your credit score quickly, offering practical tips and tools you can use. We’ll also explore the best apps that can help you track your progress, estimate loan amounts, and ensure you’re on the right path to financial success.

Let’s get started!

What Is a Good Credit Score?

Your credit score is essentially a snapshot of your financial health, and it’s based on various factors including your payment history, amounts owed, and the length of your credit history. Scores generally range from 300 to 850, and here’s how they’re typically categorized:

• Poor (300–579): This score makes it difficult to get approved for credit or secure favorable interest rates.
• Fair (580–669): You may be able to get credit, but with higher interest rates.
• Good (670–739): This score is considered acceptable, making it easier to get loans and better rates.
• Very Good (740–799): You’ll generally qualify for better interest rates and credit offers.
• Excellent (800–850): You’ll get the best terms available on loans and credit.

Why does your credit score matter? Because it affects every major financial decision you’ll make, from applying for credit cards to getting approved for mortgages. So, if you’ve been wondering how can you improve your credit score quickly, the following strategies will help.

1. Pay Your Bills on Time (35% of Your Score)

The single most important factor that influences your credit score is your payment history. Late or missed payments can have a significant negative impact on your score, so it’s crucial to pay every bill on time. If you’re looking for a way to boost your credit score fast, this is where to start.

Practical Ways to Ensure Timely Payments:

• Automate payments for credit cards, loans, and utilities so you never miss a due date.
• Use a bill reminder app like Prism, which helps you manage and pay bills by sending reminders or setting up auto-pay.

Pro Tip: Even one late payment can stay on your credit report for seven years, so it’s vital to make paying bills on time a habit.

2. Lower Your Credit Card Balances (30% of Your Score)

Another major factor in your credit score is credit utilization—the percentage of your available credit you’re using. For example, if your total credit limit is $10,000, and you owe $3,000, your utilization rate is 30%. Ideally, you want to keep your utilization below 30%.

How to Lower Your Credit Utilization:

• Pay down your balances as aggressively as you can, starting with the cards with the highest interest rates.
• Increase your credit limit to reduce your utilization ratio, but be cautious about overspending.
• Use a debt repayment app like Tally, which helps you manage multiple credit card payments and lower your interest.

Pro Tip: Even if you pay your credit card balance in full each month, make sure your credit utilization rate is low at the time your credit card issuer reports to the credit bureaus.

3. Avoid Applying for Too Much New Credit (10% of Your Score)

When you apply for a new credit card or loan, lenders perform a “hard inquiry,” which can lower your score temporarily. Multiple inquiries within a short period may signal to lenders that you’re financially unstable, which could reduce your credit score.

How to Minimize Hard Inquiries:

• Apply for new credit only when necessary.
• Use loan comparison tools like LendingTree to check offers without affecting your score. These tools often perform “soft inquiries,” which don’t impact your score.

4. Dispute Errors on Your Credit Report

Mistakes on your credit report can drag down your score unnecessarily. According to a study by the Federal Trade Commission, 1 in 5 people has an error on their report. If you’re looking to improve your credit score quickly, checking for and disputing inaccuracies is a fast way to potentially gain a few points.

Steps to Dispute Credit Report Errors:

1. Request your free credit report from AnnualCreditReport.com.
2. Review the report for mistakes, such as incorrect balances or payment histories.
3. File a dispute online with the credit bureau (Experian, Equifax, or TransUnion) to have the error corrected.

Pro Tip: Use credit monitoring tools like Credit Karma or Experian to track your score and catch errors early.

5. Keep Your Old Credit Accounts Open (15% of Your Score)

Your credit score benefits from a long credit history. Closing older accounts, especially those in good standing, can negatively impact the “average age of accounts” metric. If you’re wondering how can you raise your credit score, keeping your oldest accounts open can help.

How to Manage Old Accounts:

• Even if you don’t use an old card frequently, consider keeping it active by putting small, recurring expenses (like Netflix) on it.
• Avoid closing credit cards, unless they have an annual fee that you don’t want to pay.

Pro Tip: If you’re worried about identity theft or fraud, set up alerts with your bank and use an app like Mint to monitor your accounts regularly.

Know more about managing your personal finances

6. Become an Authorized User on Someone Else’s Card

One of the easiest ways to build or improve your credit score is to become an authorized user on a family member’s or friend’s credit card. As an authorized user, you benefit from their positive credit history without being responsible for the debt.

Things to Keep in Mind:

• Make sure the person has a strong credit score and a good payment history.
• You don’t have to use the card to benefit from being an authorized user.
• You can request the card issuer to remove you as an authorized user if it negatively affects your credit.

7. Use Credit Monitoring Apps to Stay on Top of Your Score

In addition to improving your habits, keeping an eye on your score is essential. Credit monitoring apps allow you to track your score, spot potential issues, and get personalized tips on how to improve your credit.

Best Credit Monitoring Apps:

• Credit Karma: Provides free credit score updates, reports, and recommendations on how to raise your score.
• Experian: Offers free and paid credit monitoring services, along with insights to help you boost your score.
• Mint: Not only tracks your credit score but also helps you manage your entire financial picture, including budgeting and debt repayment.

Pro Tip: Many credit card companies, like Capital One and Discover, now offer free credit monitoring services, so check with your card provider for additional tools.

8. Consider a Credit-Builder Loan

If you don’t have much credit history or need to rebuild damaged credit, a credit-builder loan can be a great option. Unlike traditional loans, you don’t receive the funds upfront. Instead, the loan is placed in a savings account, and you make payments toward it. Once you pay off the loan, the money is yours, and your on-time payments are reported to the credit bureaus, improving your score.

Where to Find Credit-Builder Loans:

• Self: Offers credit-builder loans and reports to all three major credit bureaus.
• SeedFi: Combines savings and credit-building tools to help you improve your score.

Pro Tip: Always check the terms and fees associated with credit-builder loans to make sure they’re worth the cost.

9. Negotiate Your Debt

If you’re struggling with high balances, consider negotiating with your creditors. In some cases, you can work out a repayment plan, settle for a lower amount, or request that late payments be removed from your report.

Tips for Negotiating Debt:

• Reach out to creditors directly and ask about hardship programs or payment plans.
• Consider using a debt settlement company like National Debt Relief to help you negotiate, but be cautious of fees.

Pro Tip: While negotiating can improve your score in the long term, it may cause a short-term dip, especially if you settle for less than the amount owed.

10. Take Out a Secured Credit Card

If you’re struggling to qualify for a regular credit card, a secured credit card could be a good option. Secured cards require a cash deposit that serves as collateral, and they work just like traditional cards in terms of building credit.

Best Secured Credit Cards:

• Discover it® Secured Card: Offers rewards and reports to all three major credit bureaus.
• Capital One Platinum Secured Credit Card: Great for those building or rebuilding credit.

Pro Tip: Make sure the secured card reports to all three major credit bureaus to ensure it helps boost your score.

Conclusion: Take Control of Your Credit Today

Improving your credit score may seem daunting, but by following these steps and utilizing the right tools, you can see improvements faster than you think. Remember, consistency is key: pay bills on time, keep your credit utilization low, and monitor your score regularly with apps like Credit Karma or Experian.

By being proactive and making small changes, you’ll be on your way to a higher credit score and greater financial freedom.