1. Setting up utilities is more complicated.
For those with good credit, setting up utilities usually requires a simple phone call or two – but people with poor credit have to take extra steps. If your score is really awful, you may need to put down a deposit with each utility company to get your services started.
For people who can’t or don’t want to put down the deposit, an option is to find a friend or family member who will guarantee to pay your bill in the event you don’t.
2. Getting a new job or promotion is more difficult.
Potential employers can’t view your actual credit score, but they can request an employment credit report, which omits your account numbers and personal information yet includes your payment history and loan information. In today’s employment market, a poor report could be the reason you’re rejected for a job or a promotion.
3. Starting a new relationship can be – complicated.
Not even your romantic life is safe from a bad credit score. Savvy consumers who are financially responsible know the potential impact of a partner’s bad credit on their own finances. According to a 2014 NerdWallet analysis, 53 percent of single adults over age 25 say they are “somewhat less likely” or “much less likely” to go out with someone with bad credit.
Though bad credit can be a heartbreaker in more ways than one – you can fix it. Here are five ways to raise your credit score:
1. Pay your bills on time – no exceptions, no excuses. This is far and away the most important thing to build and maintain good credit.
2. Avoid using more than 30 percent of the available credit on your cards during the month, say many experts. Monitor your balance carefully throughout your billing cycle and make a payment if you start to get too close to that threshold.
3. Start using credit as soon as you can. The easiest way to do this is to get a credit card and use it responsibly and consistently.
4. Only apply for credit you actually need – too many hard inquiries in the span of just a few months will ding your score.
5. Use AnnualCreditReport.com to obtain a copy of your three credit reports once per year. Review them, carefully, for accuracy; if you spot an error, start the process of having it corrected as soon as you can.