Tips for Building Credit

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Tips for Building Credit

Tips for Building Credit

Building credit is an important and sometimes daunting task. Your credit rating is used to gauge your financial responsibility and is an important tool for accessing the financing you may need for a home, a car, or even a small business. Having good credit is also important if you ever want to get a loan. That's why it's crucial to understand how your credit score works and how to improve it when needed. Here are some key tips for building credit.

1. Pay Your Bills on Time

Pay your bills on time! Late payments will significantly affect your credit score, and any delinquencies can stay on your credit report for up to seven years. The best way to keep track of when bills are due is to set up automatic payments, so you don’t have to worry about missing a payment. Also, if you’re in a tight spot, contact your lender or service provider about a payment plan or an extension—they may be willing to help. 1

2. Keep Balances Low on Credit Cards and Other “Revolving Credit”

Your credit utilization ratio, or the amount of credit you’re using compared to your total credit limit, makes up 30% of your credit score. If your credit utilization ratio is too high, it reflects negatively your credit score. To keep balances low, don’t charge more than you can afford. Pay down debt as soon as you can, and consider transferring balances of higher-interest credit cards to a card with a lower interest rate. 2

3. Don’t Open Too Many Credit Accounts at Once

Opening several new credit accounts in a short amount of time can be seen as a red flag by lenders and negatively affect your credit score. Stick to opening only one or two credit accounts at a time. 3

4. Don’t Close Unused Credit Cards

Closing unused credit cards won’t improve your credit score and can actually damage it. This is because closed accounts with positive payment histories stay on your credit report for up to 10 years, which helps your credit score. 4

5. Monitor Your Credit Report Regularly

Checking your credit report regularly is a key part of improving and maintaining a good credit score. Check for errors on your credit report, such as incorrect personal information or incorrect account balances, that can damage your credit score. If you find any errors, contact the credit bureau and the lender to dispute them. 5

6. Use Our Credit-Building Loans 6

Earnin offers credit-building loans, which enable users to borrow up to $100 and pay it back on their next payday. These loans can help you build credit and demonstrate to lenders that you can responsibly manage a loan. When you pay back the loan on time and in full, the payment is reported to the three major credit bureaus, so the payment is reflected positively on your credit score.


Having good credit is essential in today’s world, and it’s important to understand the actions that can help you build credit. With these tips, you’ll be able to improve your credit score and become a more attractive borrower to lenders. In addition, Earning credit-building loans can help you further build your credit in a safe and reliable way.


1. “5 Ways to Build Credit with Bad Credit.” Experian, 21 Feb. 2019,
2. “How to Improve Your Credit Score.” U.S. News & World Report,
3. “The Do’s and Don’ts of Building Your Credit.” Better Money Habits,
4. “What Credit-Building Tools are Available?” Federal Trade Commission,
5. “How to Check Your Credit Report.” Consumer Financial Protection Bureau,
6. “Earnin Credit Builder.” Earnin,


December 29, 2022

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