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How to be smart about credit

Rebecca Gramuglia

Special to the Village News

Rising interest rates can be daunting, especially when it comes to maintaining your credit score. National Get Smart About Credit Day was Oct. 20, so it’s time to build – and maintain – responsible credit habits.

Here are three credit-savvy tips.

1. Pay on time. Payment history is the largest factor in your credit score, making up 35% of the total – according to FICO. Missed payments can last up to seven years on your credit report, so you’ll want to make sure you’re paying your bills on time, even if it’s only the minimum. By keeping a clean payment history, you’ll be seen as a responsible borrower which allows you access to better loans for buying a car, home and more.

Pro-tip: If possible, make it a habit to pay off your credit card in full each month. This will help you avoid additional interest on the total balance due and save you the stress of racking up debt.

2. Review your credit report. Regularly checking your credit report is important to make sure your hard work is paying off. Once a year, request a free copy of your credit report from one of the national credit reporting agencies (Equifax, Experian or Transunion). Compare your personal records to the reports and verify that all of the information is accurate. This is what creditors and insurers have access to, and any discrepancies may affect whether you get a loan or approved for a credit card. Plus, the report can show if there’s possible fraud with your accounts. If something is missing or doesn’t seem right, file a written report of the inaccuracy to the credit agency as well as the initial information provider.

3. Pass on your knowledge. The average age of the accounts on your credit report affects 15% of your credit score – also according to FICO. So the earlier you open a credit card, the better. And if you have kids, it’s important to teach them how to responsibly build credit as early as possible. While they must be 18 to open their own account, your credit card program(s) may allow you to add your child as an authorized user when they are as young as 13.

Pro-tip: When your child is at the appropriate age, have a discussion with them about your credit card statement and credit report. These personal finance lessons will be beneficial when they eventually begin managing their own money.

Rebecca Gramuglia is a consumer expert at


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