Credit Card Solution

Building a good credit score may seem quite difficult at first glance – but provided you know the right techniques, you can successfully do it. There are a few prerequisites involved in building a good credit score such as following market discipline and going through with debt repayment procedures.

In addition to this, you need to be very patient. By keeping a few general guidelines and making timely repayments, you can be sure of building credit. Listed below are a few pointers with information that will help you to understand the prerequisites of building a good credit score.

• Your credit score begins to accumulate when you start using your credit card in places like shopping malls and departmental stores. At this point, you are given the lowest scores. I

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Most people know that late payments will negatively affect a credit score. However, it is often unclear as to how much. Should you fret over a payment that is a little late? Does it matter how late it is? How much will it affect your score? How long will the score be affected? These are all questions that are often difficult to answer – but let’s give it a shot!

Factors That Determine Your Credit Score

First, let’s take a look at how your credit score is determined. The number one factor in determining your score is – you guessed it – payment history. This accounts for 35 percent of your score. As you can imagine, this makes paying your bills on time very important. Although

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A new study from credit analytics company SubscriberWise revealed that less than two tenths of one percent of the scorable population achieved the highest possible Fico score.

So just who are these consumers with 850 Fico scores anyways?

Well, the company found that the median age of these credit-elites was 61, having a birth year all the way back in 1950.

The oldest person to achieve credit score-perfection was born in 1922, while the youngest was born in 1967.

In other words, it takes a while to achieve a perfect credit score, even if you’re doing everything right.

(See my credit score range.)

This probably has to due with the fact that credit scoring takes into account the length of a consumer’s credit history, including the age of their oldest account on their credit report, whether it’s opened or closed.

So you really need to build your credit history early on to ensure you have excellent credit in the future.

Simply paying bills on time, keeping balances low, and applying for new credit sparingly won’t be enough for that perfection you seek.

Some gray hairs also seem to be a necessity…

For the record, the SubscriberWise study was based on data from a quarter of a million credit reports, so it seems pretty thorough.

Tip: How to raise your credit score.

(photo: Bruce Berrien)

Credit score Q&A: “Does salary affect credit score?”

The short answer is no.

Your salary does not affect your credit score, as it doesn’t even show up on your credit report.

However, employment history does show up on your credit report, though it doesn’t detail anything about your salary.

That said, your less-than-stunning salary won’t have any negative affect on your credit scores (yes there are multiple credit scores).

And for those of you bringing in the big bucks, doing so won’t get you any closer to the highest credit score out there (850 for Fico score, 990 for VantageScore).

But obviously there’s probably some sort of positive correlation between high salaries and high credit scores, since a major component of credit scoring involves paying bills on time.

In other words, those with plenty of money are probably more likely to pay their bills, though it’s not a perfect science.

And that’s just one of several factors that determine credit scoring – amounts owed, length of credit history, amount of new credit, and type of credit also come into play.

So make sure you pay bills on time, keep balances low, apply for new credit sparingly, and mix it up a little to ensure you wind up with a good credit score!