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5 habits that boost your credit daily

Having good credit is as essential as a day at the beach with your loved ones: exactly what you need.

If you’re starting your financial journey, you may be wondering, “So what exactly is credit?” Simply put, your credit is your financial calling card, or “reputation,” when borrowing money; it reflects how responsibly you manage your accounts. For example, your credit can help you buy your first car, rent an apartment, or secure the best future financing rates.

Whether you’re a student, a professional, or starting a family, building good credit starts today

The steps to build a strong financial profile remain the same. The key is to start early, adapt those steps to your circumstances, and align them with your goals. Here are some tips to keep your credit in good standing.

1. Maintain a good payment history

When we talk about credit scores, we’re referring to the number that reflects how you’ve managed your accounts and debts over time (the maximum score is 850). This score is calculated using several factors, and your payment history is usually one of the most influential. In some models, payment history can account for nearly 35% of your total score. 

Although many financial institutions offer a grace period before reporting late payments to credit bureaus (Experian, TransUnion, and Equifax), if a payment is more than 30 days late or past its due date, your account may appear delinquent on your credit report. This negative mark or activity can remain on your report for up to seven years and affect your score. That’s why paying your bills on time should be a top priority.

  • If you’re just starting out: automating payments for your mobile phone service or subscriptions can help you stay on top of your commitments, avoid late fees, and build healthy financial habits.
  • If you’re working or financially established: paying on time strengthens your credit profile, helping you qualify for better credit limits and rates as you pursue bigger goals.

A solid track record can also help you face emergencies with greater peace of mind and plan personal or family goals more effectively.

2. Use your cards—but keep an eye on your balances!

Using your credit cards to make purchases or pay bills offers many advantages, including access to exclusive offers, rewards, and welcome bonuses. However, using your full monthly credit limit can harm your credit utilization ratio, which, in some models, accounts for nearly 30% of your credit score.

To protect your credit, it’s important to keep your credit card and other credit line balances under control. As a rule of thumb, keep your balances below 30% of your credit limit. For example, if your card has a $1,000 limit, your monthly balance at the close of each statement should not exceed $300. If possible, pay your statement balance in full each month. This will keep your credit in good standing and help you avoid interest charges.

  • If you’re just starting out: avoid using your credit card as an extension of your monthly income. Instead, use it for purchases you can afford.
  • If you’re working, financially established, or have children: evaluate whether your card rewards align with your spending habits.

3. Make the most of your subscriptions and other non-traditional accounts

Generally, only credit card accounts, mortgages, student loans, and other accounts are reported to credit bureaus. However, utility payments (water, electricity, phone) and subscriptions such as Netflix, Hulu, or Max are typically not reported to credit bureaus.

Tools like Experian Boost  can help you improve your credit almost instantly—at no cost—by giving you credit for on-time payments on nontraditional accounts. 

If you don’t have a mortgage, you can ask your landlord or rental property manager to report your rent payments to the credit bureaus which can help improve  your score. 

Most importantly, remember to pay on time. Doing so can help you build your credit faster, no matter what stage of life you’re in.

4. Consider consolidating your debts

If you have a healthy credit score (670 or higher) and carry balances on several credit cards (especially those from apparel or department stores, which often carry high interest rates), you may consider applying for a personal loan to consolidate your debt.

Platea x Popular Tip: At Popular, personal loans1 have fixed interest rates for the selected term.

By using a personal loan to consolidate debts into a single monthly payment, you not only have the potential to save money on interest but also set a clear goal of becoming debt-free. This strategy can be useful in several ways.

  • If you’re just starting out: save more money to invest in future goals.
  • If you’re working or financially established: prepare for major purchases (a car or a property).
  • If you have children: free up budget to enjoy more family time and continue working toward new goals with peace of mind.

5. Monitor your credit

Reviewing your credit report helps you detect errors and maintain control of your financial progress. Regularly monitoring your credit strengthens your financial health at every stage of your life.

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Closer to your financial goals

These practices can help you improve your credit every day and move you closer to the future you envision.

We want to see you achieve every one of your goals—big and small. Explore the Future Me page for more tips and resources to support you on your path to financial success.

This article is for informational purposes only and does not constitute an endorsement nor does it offer any guarantee of accuracy or applicability of its content for any particular purpose. Results related to credit scores, credit-building tools, and financing options may vary. This content does not guarantee approvals, score increases, or specific offers. Popular is not affiliated with, and does not control, the availability, terms, eligibility requirements, or results of any third-party credit-building tool mentioned. Neither Popular nor any of its affiliates, subsidiaries, or related companies are or will be liable for any special, direct, or indirect damages resulting from the information contained in this article. If you require any type of advice related to this article, you should seek it from a qualified professional of your choice.

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 Product offered by Banco Popular de Puerto Rico. Member FDIC. Personal loans are subject to credit approval. Certain restrictions apply. For more information, visit: https://www.popular.com/en/loans/personal-loans/. 

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