Finances at Four: Getting a Grip on Your Credit in 2021

Each year, millions of Americans set a finance related New Year’s resolution. It can be hard to get your finances under control if you credit is out of whack.Mm From Tom

Matt Frankel is a certified financial planner and credit expert with The Ascent.

They found last year Americans had an average revolving credit card balance of $6,271.

He says there are five things you can do to get a grip on your credit in 2021:

  1. Get a free credit report. Normally, you’re entitled to one free copy of your credit report from each major bureau — Experian, Equifax, and TransUnion — once a year. But through April of 2021, you can access your report for free every week.
  2. Set a budget to improve payment history. Being on time sends the message to lenders that you’re trustworthy and responsible, so it’s important to work on improving your payment history — it carries the most weight of the various factors that go into calculating your credit score.
  3. Lower credit utilization. A ratio of 30% or less is helpful to your credit score, whereas a higher ratio will harm it. That’s why it’s important to keep tabs on your existing credit card balances to make sure you’re not going overboard.
  4. Check your credit score. Some credit cards provide a free FICO score — the industry standard.
  5. Use a balance transfer card to wipe out interest until 2022. Balance transfer credit cards are a great way to save money while you pay off debt. This type of credit card offers a low introductory APR — many even start with a 0% APR.

The four’s Xavier Hershovitz spoke with Frankel to get more in-depth on his tips. Watch the video above to see the interview.

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