No one is a master at banking, bookkeeping, accounting, or economics. We can all make mistakes that hurt our credit scores and ratings without knowing it. Here is a guide to what mistakes you might make to improve your credit score.
Closing Old Credit Cards
Once you’ve paid off a credit card bill, it is tempting to cancel the card to avoid getting another big bill. Many people choose to close their accounts like this, but they don’t know that they are hurting their credit rating.
This is because closing a card causes you to have lower available credit, and available credit, along with the history of credit cards owned, affects your credit rating. Keeping an old credit card open and avoiding using it is much better.
Maxing Out Credit Cards Before Bankruptcy
When considering filing bankruptcy, many people find it tempting to put extra expenses on their credit cards, anticipating that the debt incurred in those expenses would be wiped out when filing bankruptcy. However, upon seeing that someone maxed out their credit cards right before bankruptcy, creditors can and will take measures against your bankruptcy in court. It can also lead to a judge rejecting your bankruptcy petition, causing a more significant financial crisis.
Applying for Gas Station and Department Store Cards
It may sound genius to have all of your gas expenses on one card and all grocery-related costs on the bill of another credit card. Unbeknownst to consumers, these cards come with extremely high-interest rates.
It is much better to go for Visa or MasterCard credit cards with much lower interest rates. Moreover, having several accounts will adversely affect your credit score. Therefore, only apply for an additional credit account when you need it.
Cosigning for Someone
It isn’t easy to decline a request from someone close to you to cosign for them on any loan. However, it isn’t commonly known that cosigning can have dire consequences for someone’s credit rating. Not only is your credit score under threat, but you might also even be liable to pay the loan if the person you cosigned with fails to pay. 
Sharing Personal Details
Calls asking for sensitive and private information such as credit card numbers or your social security number are scams targeting vulnerable groups (such as older people). Calls like these are usually from criminals trying to use your personal information to steal your money. If you ever fall victim to identity theft, it is best to report it to the police department and the Federal Trade Commission. Criminal activities through your card can badly hurt your credit score.
Accepting Offers for New Credit Cards
Offers from credit card companies are rampant. According to statistics, billions of offers are sent out by companies every year. Accepting these offers is neither a compulsion nor a wise decision. The solution is to say no if you are targeted in a sales pitch.
Ask to be removed from telemarketing lists and reject any mortgage and credit card company offers via email and phone. More credit means more hits taken to your credit rating. Accepting tempting offers can hurt your financial position through loans that take a lifetime to mature or plans with high-interest rates.
Ignoring Credit Reports
You need to check credit reports at least once yearly to maintain a good credit score. Sometimes, more than a once-a-year check might be required, so you should regularly check how you use your credit card.
Suppose you are only making minimum payments, missing out on payments, or not considering paying your bills when charging your card. In that case, you should stop using your credit card and seek professional help from a nonprofit credit counseling agency.
Opting for Credit Repair Schemes
Many people with a personal crisis, such as bankruptcy, foreclosure, or divorce, have a bad credit rating. Falling for a credit repair scheme offering to fix your credit score quickly sounds like and is too good to be true. It would help if you were wary of firms that promise to fix your credit standing to avoid paying a high fee upfront and being subject to multiple hidden charges.
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