Financial Habits That You Should Develop When Building Your Credit

Money habits written in a notebook

Your credit rating is primarily based on how you use credit products such as credit cards and loans. If you follow good financial habits and maintain them for a long period of time, you can certainly build your credit.

Stay within your financial lane

This is the first habit that you should work on when building your credit. It’s the most obvious but usually a disregarded habit of consumers. It’s important that you always only buy what you can afford. If you don’t follow this simple step, it will lead to missed payments.

Be Organized

This applies to most things in life, but even more so when it comes to your finances. You don’t want to miss payments just because you’ve lost track of when bills need to be paid. When you keep dates and bills organized, you lessen the chance of missing a payment. Not missing a payment is crucial in keeping your credit score high, as payment history is 35% of your credit score. 

Timely Payments

Paying your bills on time is a must, since a significant part of your credit rating is payment history. Your credit reports contain information about your payment history and are updated every month by the credit bureaus. When you miss a payment, it’s reported by your creditor to the bureaus and will affect your score almost immediately. Paying on time is a habit that you should develop and practice each month.

Needs over wants

Another habit you should teach yourself is prioritizing your needs before your wants. It’s always nice to get or do the things that you want, but spending too much on these things may deplete your income and cause there to be nothing left to take care of important bills. So before indulging yourself, make sure that all necessary bills are paid and that you have enough funds to cover that indulgence.

Be proactive

Mistakes don’t correct themselves, so you should always take action immediately. If you miss a payment (since nobody is perfect), don’t panic about your credit score, instead keep your cool and find a way to settle the balance as soon as possible. Your score might be affected by the missed payment, but it can only get worse if you don’t take the necessary action.  Don’t let an isolated case or mistake affect your entire positive habit. Keep in mind that the faster you react, the sooner the problem gets fixed.

Take the time to know more about a financial product

Many people tend to dive into products without really knowing much about them. You should always do your research before taking on a new credit card. There are a variety lenders and products to choose from, so when you do make a decision, be sure that you are selecting the best option for your financial health.

Continental Finance is one of America’s leading marketers and servicers of credit cards for people with less-than-perfect credit. Learn more by visiting