3 Things I'm Doing This Year to Protect My Credit Score

Here's how one writer is making an effort to keep her credit score in good shape.

There was a point in my life when I had perfect credit, but that's not the case anymore. Still, through the years, my credit score has mostly fluctuated between the mid-700s and lower 800s, which means it's been pretty decent. And often, when my score has dipped, it's been temporary. For example, I recently refinanced my mortgage, and that caused a modest drop.

In the coming year, I don't expect to get a new home loan or borrow against my home since I'm not planning any major renovations. However, a new car may be on the horizon as our 14-year-old vehicle is slowly but surely showing its age. Plus, you never know when the need for a loan might arise. As such, I want to keep my credit score as strong as possible, and I'm counting on these moves to protect it.

1. Checking my credit reports often

Last year, my husband learned that someone tried to open a new credit account in his name, and that spooked us. Since then, we've worked to be more vigilant about checking our credit reports because sometimes that's the only way to learn about fraudulent activity. What's more, misinformation on your credit report could bring your score down, so it's important to see what the credit bureaus have on file for you every so often.

Between now and April, credit reports can be accessed for free every week, but I don't plan to go to that extreme. Instead, I'll aim to check mine once a month while those reports are free, and then I'll check in again later in the year. (Outside the pandemic, you're entitled to a free copy of your credit report once a year from each of the three major reporting bureaus: Experian, Equifax, and TransUnion.)

2. Setting new bills to autopay

Some of my bills are the same every month, like my cable bill, while others, like my utility bills, tend to fluctuate. Because of this, I like to go in and pay those bills manually so I can see what I'm spending. But late last year, I somehow forgot to pay my natural gas bill by its due date. Thankfully, I realized my mistake a week after the fact. That was a good thing because you're generally not reported as late on a bill to the credit bureaus until you're at least 30 days behind on payment. In my case, I corrected my error in time to avoid late fees.

That incident, however, was a wakeup call, and so now, I'll set my electric, heat, and water bills to autopay. If I want to know what I'm spending, I can log into my accounts and look, but this way, I won't run the risk of being late.

3. Not opening new credit cards

Like many people, I love getting great deals, and sometimes that means opening the right credit cards to capitalize on sign-up bonuses. But I'm not planning to do that this year. For one thing, having too many credit cards could hurt your credit score, as could applying for too many within the same time period. But also, sign-up bonuses can encourage needless spending, and I'd rather avoid that temptation.

A couple of years back, I needed office furniture that I'd priced out to be at least $1,500. So I decided to apply for a credit card offering a $500 sign-up bonus for making $3,000 in purchases within three months. That was a smart move, because I knew I'd be spending at least half that on furniture and would easily rack up the other half from filling up my car, buying groceries, and purchasing household essentials. But since I'm not planning any big purchases this year (other than possibly a car, which I wouldn't put on a credit card anyway), I don't want to put myself in a position where I feel forced to spend money just to snag a bonus.

Thankfully, I'm starting the year with pretty good credit. But you never know when you may need to borrow money in a pinch, so protecting my score keeps that option open. If your credit score could use some work, you may want to focus on paying your bills on time and paying off some existing debt to lower your credit utilization ratio. The higher your score, the more flexibility you'll buy yourself.