How Does My Credit Score Affect Me?

Auburn Savings Credit Report imageIf you’ve applied for a credit card, student loans, or even a new cell phone plan—congratulations!—you’ve started building your credit. Simply speaking, your credit report is the history of all of your financial accounts that were and are in repayment. This report lets lenders know how responsible you are with your debts. Your credit score is determined by how well (or not so well) you take care of those financial accounts. It goes without saying, but in case you’re still learning — you want a high credit score. So, how do you make it happen?

  • Pay all bills on time
  • Keep balances low
  • Spend within your means
  • Limit credit applications


Money Management

You’ve opened lines of credit and started using them responsibly. Great! Now just sit back and forget about it, right? Incorrect! You want to keep a fairly close eye on your credit report, just like you would your bank account.

  • Are you a Maine resident? You get a free credit report annually, so make sure to review your report at
  • Using your free report to check your score doesn’t negatively affect it
  • Keep your debt-to-income ratio low
  • Report any discrepancies to the credit bureau


Financial Fitness

Now that you’ve opened lines of credit and have kept your accounts in good standing, let’s take things a step further. Maybe you applied for a credit card in case of emergencies and it sits unused in your wallet. That’s totally fine, but your credit score is also determined by other factors.

  • Payment History – use autopay to never miss a payment deadline
  • “Utilization Ratio” – put everyday purchases on credit cards—just be sure to pay them off each month!
  • Length of History – open lines of credit strengthen your report
  • Types of Credit – mortgages, student loans and car loans add diversity to your report


Credit Conclusion

To recap, why should you care about your credit score? By having a higher score, you may be eligible for a lower interest rates on credit cards, bank loans and refinancing, saving you money in the long run. The higher your score, the more likely you’ll be approved for the things that you want—rental apartments, mortgages, home equity loans, even jobs. In order to keep that score high, remember: pay bills on time, spend within your means and keep a close eye on your accounts.

Skip to content