We all know the importance of living a healthy lifestyle and receiving regular checkups to make sure everything is working as it should. Most of us can also appreciate the effectiveness of being proactive to avoid having health problems in the future. Your finances can benefit from the same train of thought. If you want to have good credit you have to be proactive and take steps to prevent your credit from suffering. A regular checkup will ensure you are not overlooking developing problems as well. Here are a few tips to help keep your financial health in check.

• Never Pay The Minimum Payment- There are generally two types of people who pay the minimum payment. The first are people who do not know enough about credit to understand how paying only the minimum payment will take years and years to pay off a relatively low balance. The second group of people understand that principle yet they cannot AFFORD to pay more than the minimum. In either case paying only the minimum payment required will cost you hundreds or thousands of dollars in the long run.
• Check Your Credit Report- Each person is entitled to one free credit report from each credit reporting company once a year, yet many consumers simply do not take advantage of this opportunity. It is important to remember that credit reporting agencies do not verify information that is reported which means there may be inaccuracies which can negatively impact your credit rating. Make it a priority to check your credit report to ensure all information is correct as well as spot signs of identity or credit card fraud.
• Understand How Your Credit Score Is Calculated- The formula used to determine your credit score may seem complex but there are certain factors that are easy to understand and control. Arm yourself with this information to make better choices when it comes to how you handle your revolving accounts.
• Reduce Your Debt- Debt elimination cannot be stressed enough when it comes to health of your finances. It is important for both your credit rating and your overall financial security to reduce or eliminate high interest debt.
• Use Credit Responsibly- There is not doubt that credit cards can be a great financial tool when used responsibly. Consumers can enjoy the convenience and rewards of using credit cards if they remember to keep their spending under control, pay the balance in full each month and make payments on or before the due date.

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