Here’s how to improve your credit score

EDITOR’S NOTE: Money Matters is a series of stories running on SILive.com that provides financial advice on common money issues related to everything from saving for retirement to buying a home. And while many of you have financial-related questions and no one to ask, that’s where we come in. Simply reach out to us, and we’ll get the expert advice you need.

STATEN ISLAND, N.Y. — As Americans, numbers define our lives — social security numbers, passwords, codes and credit scores. And when it comes to obtaining a loan to pay for college, buy a home, rent an apartment, or purchase or lease a car, the most important number is your three digit credit score.

Some of the smallest missteps can hurt your credit rating, and some big ones — like defaulting on credit card payments or filing for bankruptcy — can devastate your credit for a several-year time period. When in this situation, many people look for ways to boost their credit score.

For this reason, we caught up with Daniel R. Masiello Jr., a financial advisor with the Bloomfield-based Ameriprise Financial’s Masiello, Nicolosi & Associates for some tips on how to improve your credit rating.

Q. How can you improve your credit score?

Masiello: “Here are some tips:

• If you are concerned with your credit rating, try to reduce or eliminate taking on new debt for the time being.
• If you plan to use a 0% balance transfer, make sure you have a plan to eliminate the debt during the 0% period. Otherwise, this could become a vicious cycle.
• Pay down the highest-interest debt first to minimize the amount of interest you pay.
• If a debt has a low balance and you are able, pay it off completely. This is a good mental victory and also knocks off a liability from your personal balance sheet.
• If you have paid off a credit card, don’t immediately cancel the card as doing so can increase your debt usage ratio, and would have an adverse effect on improving your credit rating.”

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