The second Friday in January is known as Quitter’s Day because it’s the day that many give up on their New Year’s resolutions and fall back to their poor habits. This year, Quitter’s Day was Friday 14 January 2022.
Just in case you’re in danger of giving up your financial goals already, here are five tips to help you stay on track and maintain a good credit score for the rest of the year.
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1. Review your credit report frequently
Kelli Fielding, TransUnion’s managing director of consumer interactive in the UK, advises that making a point of frequently checking your credit report is a good starting point. The logic is that you’re able to better monitor and manage your finances, which makes a lot of financial sense.
On the one hand, a constant reminder of the information in your credit report keeps you in check, ensuring you stick to your new year resolutions. And on the other, you can detect any errors and ensure they are corrected so that the information in your credit report remains accurate and doesn’t impact your credit score.
2. Avoid negative footprints on your credit file
If you apply for credit and get rejected, you might leave a ‘negative footprint’ on your credit file that may lower your chances of getting credit in the future. The negative footprint is known as a hard inquiry (a record showing that a creditor reviewed your credit report to make a lending decision).
Your credit report won’t indicate whether your credit application was rejected or accepted. However, frequent applications with hard inquiries might affect your credit score in the short term.
It helps to use a free eligibility checker, which enables you to calculate your ability to get credit without impacting your credit score.
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3. Disassociate yourself from bad financial partners
Whether it is a joint account or mortgage, it’s important that your partner be a person who is financially responsible. Partners who are late paying bills or have accumulated a lot of debt aren’t good for your financial health. If you have joint financial responsibilities, their poor money management will show on your credit file, affecting your credit score.
What you can do is apply for a notice of disassociation. This is a way of asking to become financially disassociated with a partner you share accounts with. The notice is requested from credit reference agencies, but you may need to show proof that your financial connection has been broken.
4. Pay your bills on time
One of the main things considered when generating your credit report is your payment history. Your ability to pay your bills or debts on time is vital. Try to pay your bills on time, if not early, every month. It also helps you to avoid penalties, fees or interest charges caused by late payments.
5. Get your name on the electoral register
According to the gov.uk website, the electoral register lists the names and addresses of everyone registered to vote. What does getting your name on the electoral register have to do with your credit report? It gives lenders an easy way to check and confirm that you’re who you claim to be. This is crucial for building a strong credit score.
