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Today, a number of people know the importance of having a good credit score, as life can be pretty tough, if you are not able to access good credit services. However, recent reports suggest that most people do not have enough knowledge on how to build up their credit score, and have virtually no understanding of how important credit scores can be.

It is vital to note that having a poor or no credit means that you will be struggling when it comes to getting loans or finances. This may include some important finances, such as car loan or mortgages. In other cases, you may also struggle to even get a bank account or rent a proper in future, so it can have a really huge impact on your overall life.


People, especially youth, need to know a lot when it comes to credit score building. Without this piece of advice, they may struggle in future, while they step into building their lives. As part of a survey, 500 people, with ages between 17-37 were questioned about credit score, and whether they know about it and matters like building credit, credit repair and working capital or not.

Major Belief

One of the major things highlighted by this survey included the belief that if you use your credit card more often, you will get a good credit score. However, this can affect your credit score quite the opposite. As using a credit card poses a risk to the lender, using your credit card can actually damage your credit score. Experts explain that the key to building a good credit score is not to overuse your credit card, but to use it sensibly, and repay the bill at the right time each month.

Maintain a Good Score

Some people thought that in order to maintain a good credit sore, you need to max out your credit card and then pay it off. Yet again, this can actually have serious adverse effects on your credit score, as you are using your card to its very limit, which can be a bad news in the eyes of your credit card lender. Experts suggests that you may only use 30% of your credit limit before your card bill is repaid.

Most of the people studied believed that if you wish to have a good credit score, you need to have some kind of debt. While having a debt can be helpful in building credit score, this is only when the balance is being paid off on the right time each month. Carrying a very large amount of debt can greatly damage your overall score, and mark you as high risk in eyes of lenders.

Calculating Credit Score

A number of factors go into calculating your overall credit score. 35% of score is calculated using payment history, while 30% is calculated by how much credit have you been using. A further 15% is determined by the length of credit history, and 10% is towards the combination of credit. The last 10% comes from a number of new credit enquiries that you are making, so you should be avoiding applying for a number of credit, in a shorter period of time.