How I raised my credit score 400 points — SHE-WISE (2024)

It’s true, my credit score was once low enough that it had the potential to go up by 400 points.

There was a time when I was embarrassed about this. But today I am proud.

I’m proud because I refused to let my ‘circ*mstances’ dictate my future.

I’m proud because I refused to let my lack of knowledge keep me stuck.

And I’m proud because, do you know how hard it is to break generational cycles like this?

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Our relationship to money is almost always a learned behavior.

Having the drive, discipline, and ambition to change these behaviors is one of the hardest things you’ll ever do.

I believe in you.

I have a feeling you’re a lot like me.

You have the best intentions when it comes to your money, spending, and future.

But you likely didn’t have the best examples to get you started. Then life happened, and although you may not have been completely careless about your money, it all happened quickly and somehow, you veered off course.

Guess what…SAME.

I have to tell you, the biggest impact for growing my credit score is likely the last thing you want to hear.

It’s the last thing any of us want to hear because it’s both the most simple & hardest thing all at once.

Patience my friend. To see long-term change in your credit score, more than anything else, you must be patient.

How we do one thing is how we do everything.

What this means is that if you struggle with patience when it comes to your money, you likely have a hard time being patient in any area of your life.

Thankfully, as you learn to grow your patience muscle by way of credit score, you will also see yourself becoming more patient everywhere else in your life as well.

After patience, here’s what I did…

One. I paid my bills on time every month, no exceptions.

This is actually one of the most impactful elements of which direction your score moves.

Every month, pay on time. Set reminders, sit down and budget your money with due dates for everything and then work backwards. Do whatever you need to do to get your bills paid on time.

Two. I set up payment plans for every one of my accounts that was in collections.

Creditors may tell you that you have to pay off your balance at once or in a few payments that are still too high for you.

The good news is, they want their money as much as you want financial freedom, and they are willing to negotiate.

Don’t take the first no you hear.

I chose to use my entire tax refund that year to put toward my debt. I put a certain amount of this refund toward each account in collections. I calculated how much to put toward each account in the following way:

Say my refund was $2,000 and I had five accounts open in collection. I calculated what 20% of each accounts total balance was and I paid that. Whatever was still remaining from my $2,000 refund at this point was then put toward my lowest balance account to get it out of the way.

From there, I was able to negotiate with the creditor, how much I could afford monthly on the remaining balance.

With this initial balance payment, creditors were much happier to work with me.

Side note, it is actually more effective to make several payments when paying off debt like this because it shows ongoing responsibility. Alternatively, if you call and pay it off all at once, it may look to creditors that you have simply come into money to pay your balance instead of gaining financial responsibility.

Three. I opened a secured credit card to begin building positive credit.

A secured credit card is one in which you give them money as a deposit to open a credit card. The deposit is usually between half and the full amount of the credit amount they are willing to give you.

In my case, I gave them $100 to secure a $200 credit card.

Four. I never used more than half of my available credit.

This means, when I had the secured card with a $200 balance, I never put more than $100 on it at a time.

Simple. This shows financial responsibility. If you’re always charging up to the limit, it shows that you are likely unable to limit the amount you are spending.

Five. I always paid at least double my minimum monthly payment.

If my minimum payment amount was $20, I paid at least $40.

Paying only your minimum makes always benefits the creditor. It also increases your interest charges therefore decreasing your credit score over time with the growing balance.

Paying double your minimum means you are carrying a small balance but getting ahead of the interest charges.

Note- I did notice that one of my credit card’s available dollar amount increased a lot when I left a very small balance on it each month, close to 20% of the balance before payment was made. Example, if my total balance was $100, I would pay $80.

Six. I never close my credit cards.

Closing a credit card lowers your available credit amount. Which also lowers your credit score.

I feel that it’s better to avoid opening a credit card at all if you know you plan to close it at some point. I’ve also learned that if you don’t use a credit card for a long enough time, the credit card company will automatically close it for you. Be aware of this so that you can avoid any involuntary card cancellations.

Being patient as the months went by and staying committed to my goal of increasing my credit score is exactly how I did it.

Although it is hard, it is also simple.

So often we don’t follow through on a goal simply because we don’t want to wait it out. Yet, how ironic, because the time passes the same way no matter what we do with it.

So, what are you willing to do to make similar changes?

I KNOW you can do it! And I also know how proud I, and you, will be of your accomplishments.

You’ve got this!

What are you waiting for?

Start today.

P.S… Let me know how it goes!