Boost your credit score

It measures how likely you are to repay your debts, and can determine whether you’ll get a bank loan to buy your dream house or car.

so what exactly is it?

Your credit score is based on your billing history with banks or credit companies. How it’s calculated is confidential, but the final score is made up of a number and corresponding letter grade – A being the best (you repay your loans in full and on time) and F being the worst (you default on loans and are an undischarged bankrupt).

Keep a good credit history

Banks look at the length of your payment history, so the longer your track record of paying bills in full and on time, the better. “Six months to a year of making full repayments for a substantial loan can improve your credit rating,” says Mark. For the same reason, don’t cancel the credit card you’ve had the longest, especially if you’ve always repaid the balance on time. “Think of it as the most outstanding item on your ‘report card’,” he says. “Cancelling it could even lower your credit score.” So keep the card – but keep up the timely payments in full.