It’s a fact of life that to get credit, you need a credit history.

But how do you build credit? Credit cards are an obvious example. By having one or two credit cards that you use regularly, but keep up-to-date with the minimum repayments, or pay off in full, you can improve your credit score.

Building and maintaining a good credit score is a sensible strategy in your financial matters. So what other ways can help you build credit? Let’s take a look.

Stay on top of your debt

There’s no issue with having debt. In fact, well-managed debt can improve your credit rating. But potential creditors want proof that you can pay off debt in time. It’s vital to stay on top of all your payments. Set up direct debits to pay your minimum payments each month, so you don’t miss any.

Pay your rent on time

Are you a tenant in rented accommodation? If so, you can use this to boost your credit rating, as long as you pay your rent on time.  

Until very recently, rental plans couldn’t be factored into credit scores, but after a debate was held in Parliament last year, some 150 social housing providers signed up to a scheme which gives tenants the same kind of credit recognition that mortgage payers have. Private tenants can also report their payment data through Credit Ladder or Canopy.

Perform regular checks

When was the last time you checked your credit score, if at all? Many people worry that doing so can damage their record.

But this is a myth. Checking your report won’t affect your credit rating and it will help you identify ways to clean up your file. For example, you can de-link yourself from people you had joint accounts with. It may even highlight errors, which you can then ask the credit reference company to investigate for you. Just visit a Credit Reference Agency (CRA), like Experian, to look at yours.

Register to vote

This simple task helps credit companies confirm who you are and where you live and consequently increases your credit score. You can register here.

Don’t regularly apply for new credit

If you’ve recently been turned down for credit, wait before applying for credit again. Applying for credit immediately after you’ve been turned down looks like you are in financial difficulty. An option is to ask lenders to perform a ‘quotation search’, also known as a ‘soft’ search. This looks at the likelihood of you being accepted, without leaving a search footprint on your credit history.