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In this video, we've compiled the ultimate guide of credit score tips from successful entrepreneurs and investors. Learn from their experiences and advice on how to improve your credit score and manage your finances more effectively. Don't miss out on this valuable information that could help you achieve your business and financial goals!
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Hey everyone, Bev here from Finance Home Friend
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And in today's video, I'm going to guide you through the foolproof steps to boost your credit score
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If you're an entrepreneur or investor, you need to recognize the paramount importance of maintaining
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a stellar credit rating. Make it your personal mission to learn everything there is to know about credit scores
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Discover how the average person can quickly reach that coveted 800 score
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Well, it's a good thing that we rounded up these simple yet effective strategies
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Not only will you enhance your creditworthiness, but you'll also expedite the process of securing
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approval for business loans. Stick around until the end, as I'll provide you with a
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comprehensive game plan to kickstart your journey starting right now. 7. Pay your bills on time. Make sure to pay your bills on time consistently. It's not just
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about avoiding extra charges. Timely payments also builds your credit history, boost your credit score, and demonstrate reliability
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to your banker. According to FICO, the credit score experts, your payment history alone accounts for a whopping
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35% of your score. Vantage score, another key player, may not give percentages, but they emphasize that payment
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history holds massive sway. Bottom line, paying late can seriously dent to
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your credit. And the longer the delay, the more damage it does. The secret to a high credit score
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consistently making all your payments, be it credit cards or other bills, on time over the long
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haul. But why does it matter? Well, a solid credit score means lower monthly payments when you're
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ready to snag a loan. Whether it's for a car or a dream house mortgage or that business loan
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a higher credit score equals better interest rates Plus it opens doors to better deals from other service providers Think landlords and cell phone companies
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They use your credit score to size you up as a potential tenant or customer
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Score high and you might just snag that big business loan everyone's eye in
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If you're enjoying what you're seeing so far, do it's a solid. Give that thumbs up a little tap
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Hit subscribe and ring that notification bell. That way, you'll be. the first to know when we drop more insightful content. Your support truly makes a difference
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and we're excited to have you as part of our community. Now let's get back to the good stuff
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Six, have the right credit mix. The types of debts you have matter too. Having too many credit
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cards or opening multiple accounts simultaneously can negatively impact your score. To safeguard
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your credit rating, only apply for the credit you need and believe you'll get approved
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When you or a potential lender checks your credit report, you'll find a rundown of all the credit
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accounts linked to you, past and present. For those of you with a solid credit history, that list likely boasts various credit types
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like credit cards, a mortgage, or maybe student loans. What this shows lenders is that having this mix of credit, including revolving, and installment
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credit, is like hitting a credit score jackpot. But, and it's a big but, it's not just about having them, it's about paying them on time too
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Your credit mix makes up 10% of your FICO credit score, a score used in over 90% of lending decisions
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So paying attention to this mix can seriously boost your credit game
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Keep your credit utilization rate low. How much you use your credit is a big deal
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It's like predicting if you'll struggle with payments and a credit. affects your credit score directly Here the thing many people miss Credit utilization ratios It just how much credit you use compared to what you have available
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Simple, right? Try to keep it between 15 to 30% of your credit limit every payday
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Why does it matter? Well, it tells your bank, and later on, those credit bureaus
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that you're not overly hooked on your credit card. If you need more than 15 to 30%
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no worries. You can handle it by asking for a higher limit, getting a new line of credit to spread the spending or paying off your balance more than once a month. It's like giving your credit habits a smart makeover
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4. Separate your business credit from your personal credit. Keep in mind that your business credit score is different from your personal score. It involves feedback from companies that do business with your company, like
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suppliers and banks. It's a good idea to keep your business credit separate from your personal
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credit. Use business loans, your business loan of credit, and business credit cards for
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things like investments, buying supplies, and adding to your working funds. This helps maintain
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a clear distinction between your business and personal financial matters. Three, check your credit report regularly. Your credit report gets updated regularly to show the
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latest info the credit bureaus get. If you spot mistakes, it might mean your info got mixed up with someone else's
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or you've become a target for identity theft. Errors like old info or a payment wrongly marked as late can bring down your credit score
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These scores decide what credit products and interest rates you can get
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Fixing a mistake might actually boost your scores. Also, if you changed how you pay because of the pandemic
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Check that it recorded right It smart to look at your report before applying for a big loan or job hunting 2 Avoid debt collection and bankruptcy
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Not paying your bills until they're handed over to collection agencies, your stuff gets taken away or you have to declare bankruptcy
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Well, definitely mess up your credit score. Never let it get to a point where your belongings are taken away publicly
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Going into collections or declaring bankruptcy really hurts your credit score. It's super important to avoid that if you want to keep your credit in good shape
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1. Be patient. It's tough to predict how long it takes for someone's credit to get a lot better
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So with that, entrepreneurs should start building their credit history early. Begin with personal and business credit cards and use them wisely
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This creates the kind of history that's good for both your personal and business credit scores
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What other tips would you like to add? Let us know in the comments
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Just remember that this is not financial advice. Finance homefront doesn't give tax, legal, or accounting advice
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The stuff we talk about in this video is just for fun, not meant to guide serious positions
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Always check things out yourself before making any money moves. If you found this valuable, be a champ and cheer it with a friend
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Don't forget to hit that like button. And if you haven't already, subscribe to Finance Homefront and ring the notification bell for more content just like this
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We cover a ton of topics on personal finance, investing, and entrepreneurship
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Your support means a lot to our channel. Thanks a bunch. And catch you in the next one
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