How to maintain a
high credit score

Having a high credit score can save you thousands of dollars in interest costs, and can provide bargaining power when you deal with landlords, insurance companies, cell-phone providers, utilities, and other businesses.

That's why it's prudent to keep your credit history clean and your credit score high.

Generally speaking, a credit score is a composite of five factors:

1. payment history,
2. length of credit history,
3. new credit,
4. types of credit used,
5. and debt.

Payment history - paying your bills on time - is the most heavily-weighted factor. People with scores below 620 are generally considered high risk; those with scores above 760, low risk. Other things being equal, lower risk translates into lower interest rates for you.

In addition to paying your bills on time, the following suggestions can help you develop and maintain a high credit score:

• Keep your accounts open. Think twice before closing an account that's had a zero balance for several years. That's because lenders are looking for a long credit history. You might even consider regularly charging a few items to old credit cards, just to ensure that your accounts remain active. (Of course this presumes that you pay off the new balances in full.)
• Don't apply for too many credit cards or loans. Whenever you apply for a new credit card or loan, lenders check with one or more credit bureaus, and these inquiries can reduce your overall credit score.
• Keep your account balances low. One rule of thumb is to keep your balances at 30% or less of your credit limit. Big balances can hurt your score, even if you pay the monthly minimum.
• Regularly review and correct your credit report. If you discover major errors in the report, ask the credit bureau to make corrections. Such errors might include late payments that aren't yours or lower-than-actual credit limits.
• Don't ask creditors to lower your credit limits. Reducing credit limits can shrink the gap between your balances and available credit, and this in turn can adversely affect your credit score.

For assistance with any of your financial concerns, contact our office.

Ciuni & Panichi, Inc.
Certified Public Accountants & Business Consulting Firm


25201 Chagrin Boulevard
Cleveland, Ohio 44122

(216)831-7171
Fax:(216)831-3020