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Step 1
Establish a good credit history. Pay your bills in full and on time. A good payment history could lead to easier access to credit when you really need it and could also make you eligible for more attractive interest rates.
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Step 2
Borrow wisely. Don’t take on more debt that you can afford and beware of shady lenders and aggressive salespeople. If a deal sounds too good to be true, it probably is.
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Step 3
Work with your creditors If you get behind. Call the people you owe money to and try to work out a reasonable repayment plan within your means. Since collecting on unpaid debts can be costly and time consuming, many creditors are willing to work with you. Get help if you need it. Credit counseling services can help get your bills under control.
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Step 4
Pay higher interest debt first. Try to pay down the debt that is costing you the most. Tackle the higher interest debt first and then move on to the one with the next highest interest rate.
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Step 5
Check your credit on a regular basis. Mistakes happen. Identities are stolen. One way to protect yourself from these pitfalls is to check your credit report regularly to make sure it’s accurate. Free credit reports are available on an annual basis from the main credit reporting agencies. It’s easy and could alert you to problems before they get out of hand.
