While millions of consumers have a general anxiety or respond in a reactionary manner when considering their personal credit, there are definitely tips and tools to ensure that good credit is not some mysterious force, but an attainable financial tool.  Listed below are a few pointers to incorporate into your own positive financial relationship with credit.

1.  Understand the importance of you FICO Score:  A FICO Score is a credit scoring metric that lenders use to assess a consumer’s credit worthiness and risk.  The measurable components of a FICO Score include payment history, debt load, credit history, credit mix and new credit.  Each category accounts for a percentage of the consumer’s total FICO calculation.
2. Pay your bills on time: Setting up payment reminders and opting for automatic draft payments from your banking institution will ensure that you don’t miss a payment.  Paying your bills timely and responsibly not only impact your credit score positively, but accounts for roughly 35% of your credit worthiness in the eyes of potential lenders.
3. Reduce your debt load:  Carrying too much debt may reflect as irresponsible or as living outside of your current means in the eyes of lenders.  One way to get your debt under control is to pull your credit report and make a concerted effort toward paying down the active debt listed there.
4. It’s never too late to get current:  Despite your previous delinquency history, getting back in the rhythm of making timely, if not consolidated and/or reduced payments will assist greatly in establishing a consistent payment history and a good illustration of credit responsibility.
5. Manage your revolving debt:  If you apply for credit, max out your credit cards, stop using credit (entirely), or miss monthly credit payments, your credit score will go down.  Because extended credit is simply borrowed money (with interest), you are ultimately required to repay what you owe.  Not doing so could lead to late fees, default or the risk of legal action being taken against you.  While it is always my recommendation to make more than the minimum monthly payment on your revolving debt accounts (to avoid prolonged and accruing interest), it is very important that you pay at least what is due each billing cycle.  

While practical in concept, the application of these recommendations will go a long way toward increasing and solidifying a robust FICO Score and financial future.