Some keys to maintaining your credit score: Money in Your Pocket

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One of the easiest ways to improve your credit score is to improve your credit utilization ratio. 

And finance expert Rick Reagan points out that the most important thing about maintaining your credit score is paying on time – that factor accounts for 35 percent of your score.

The second most important factor, Reagan says, is your FICO score.

“So what exactly is it?  It’s pretty simple, what they do is they take a look at the total amount of credit you have available that you can borrow again. So you know you tally up all of your credit cards and then they take a look at what you’re actually borrowing, looking then at the ratio,” Reagan said.

So if you have $10,000 you could borrow and you get $3,000, or 30 percent, that’s a credit utilization of about 30 percent.

Keeping that number at 30 percent or under will help give you a good credit score, while going above it will damage your score.

“And even if you’re paying of your credit cards every single month they actually don’t know that when they’re looking at your score. They’re just looking at whatever your utilization is at the time they check it. So, if you have $9,000 out on a $10,000 credit line, even if you’re paying that off every month that’s a lousy credit utilization and it’s going to hurt your credit score,” Reagan said.

Rick Reagan is a regular contributor to NewsChannel 9 WSYR.

If you have a question for Rick, email TheMorningNews@LocalSYR.com.

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