A credit score is usually a three digit number that determines the creditworthiness of a person. This score is calculated by the credit bureaus by using information about the consumer’s past payment history, credit available and used, bankruptcies and other factors such as length of credit history. Having a good score is pivotal for securing a healthy financial future and can have a massive impact on a person’s financial as well as personal life.
Credit cards play a vital role in determining the credit score of a person and need to be used with diligence in order to improve the score. The best way to improve the credit score is by paying off the credit card in a timely manner in full. Making the minimum payments will lead to accrual of interest and may negatively impact the score. Moreover full payments also ensure that your credit history improves from the lender’s perspective.
