Without a doubt, you must work to build your credit score and credit history over time. There are many situations in which your credit is not in the shape you want it to be. You may have made some financial mistakes or had a difficult time in your life. Other times, you have not had credit access to build that strong score.

There are various things you can do to rebuild or build your credit. If you are not where you want to be right now, consider these tips for repairing your credit.

Check Your Credit Report

The first step is to check your credit report. You cannot work towards repairing your credit if you do not know what is on your credit report in the first place. Here are some steps to take:

• Get a copy of each of the three credit reports from the credit bureaus by going to AnnualCreditReport.com. There is no cost to you for using this federally sponsored website to request your information.
• Look over your payment history. Late payments are one of the most impactful parts of your credit score.
• Look for any closed accounts. Keep older accounts open even if you do not use them because they help establish your credit history.
• Look for any judgments or collections actions against you. If there are any you do not recognize, dispute them.
• Determine how much debt you have. For example, what is your credit utilization – the amount of credit you have compared to the amount of debt you owe? Keep this under 30% for the best long-term impact on your credit history.
• Check out the credit inquiries on your report. Any hard inquiries could impact your credit score. Avoid applying for more than one or two lines of credit in any six-month period to help keep this figure low.

Address Errors on Your Credit Report

Make sure all of the information on your report is accurate. If you see accounts that are not yours or you find data that is inaccurate, dispute the claim with the credit bureau. As you look through your credit report, take note of any information that is not accurate, including:

• Your name and aliases
• Your address and former addresses
• Your accounts – are they all yours?
• Your payments – are there any being reported late that are not?
• Any inquiries
• Any collections or judgments

If you find anything inaccurate on your credit report, follow the credit bureaus' steps to help dispute those claims. The credit bureaus will require the reporting lender to verify the information; if they cannot, the information comes off your report.

Plan to check your credit reports at least one time every 12 months. You can use the AnnualCreditReport.com site to do so one time each year without cost. Try to stagger them so you check your credit report every four months, once from each credit bureau.

Pay Your Bills on Time

Many factors impact your credit history and credit score. One of the most important is making payments on time. If you borrow money, the lender will tell you how much you need to pay, when your payment is due, and how much interest you must pay. Make sure you always make these payments on time.

One of the easiest ways to ensure that is by working to build a budget and then setting up automatic payments.

• Determine how much you can pay each month.
• Pay more than you owe to reduce your long-term costs.
• Set up automatic payments with the lender. That way, they are never late.
• Verify that your payment will post in time by logging into your account a few days before it is due.
• Consider using a digital calendar or other financial tools to help you make sure payments are being made on time.

Reduce Your Credit Card Debt

Work to reduce how much debt you have. Keeping your credit usage under 30% of your overall available credit is necessary to boost your credit score. Here are some tips for doing this:

• Make more than the minimum payment on your loan every month.
• Work to pay down your loans by creating a cash-based budget and setting aside extra money towards the highest monthly debt or interest rate. That way, you are paying towards one debt significantly.
• Put extra money you receive towards lowering your debt. Remember, you are paying interest on all of those purchases. Your money goes a lot further when you can pay off high-interest-rate debt.

Consider a Secured Credit Card

If you do not have a strong credit history, a secured credit card could help you to build it. These cards allow you to pay a deposit to establish the credit line and use them as a credit card. They will report to the credit bureaus over time, helping you to build your credit score.

Make It a Consistent Effort

When it comes to making payments on your debt, be consistent. Create a budget and work with your lenders to keep payments low. Don't be afraid to use credit to build it, but be sure you are working towards intelligent financial decisions.