Are you struggling to maintain and build good credit? As many people start their credit journey, it can be hard to know where to start and what to do. When you break it down into simple steps, it makes it easier to tackle in bite-size chunks. To break down the barriers ofcredit with FASTAtips, you can use this blog as a tool to start.

1. Get a Store Card

Stores around South Africa offer “store cards.” A store card is something a retailer will offer that comes with perks towards that shop, like a discount or credit points. South African retailers like The Foschini Group, Edgars, Woolworths, Pick n Pay, Game, Makro, and more, offer store cards. These cards allow you to buy items from their stores usingcredit. It is a small amount you can purchase through the card and the quicker you pay it back, the better for yourcredit score. What is advised is to always pay back your cards on time (the date that is agreed upon by both parties).

2. Pay Bills on Time

By paying your bills on time, you are seen as a responsible borrower. Since you do not end up owing money on your bills, this has a good impact on your score. When you take out aloan, you agree on the exact date that each repayment needs to be made. When you make this agreement, you willneed to knowwhat factors affect your payment date. This includes when you get paid and when other payments go off that you cannot change. 

3. Limit the Amount of Credit You’re Using

If you get acredit cardwith a R10 000 limit, you want to aim to keep 35% of that in your account, at minimum. This means that R3500 a month is always in that account. By doing this, you are able to ensure that yourcreditaccount doesn’t end up in arrears. Here are 3 methods you can use to help limit the amount ofcredityou use:

Decrease Your Spending

Attempting to decrease the amount you spend is always a tough battle but useful when limiting the amount ofcredityou use. Only use yourmoney on essential things for a shortperiod of time until your credit bill is paid. This will limit the use ofcredit.

Pay Down Your Balance Early

By paying down yourcreditbalance early, you  improve your score as well as give yourself freedom of not having to stress about paying off your credit. When you pay early, you are showing the bank and other lenders that you are a responsible borrower and a good candidate for a futureloan. 

Pay Off Your Credit Card

When yourcredit cardis paid off, this is a good thing as you no longer owe money to the bank on this card and the credit is now available for you to use again. 

4. Get a Phone on a Contract 

If you are over the age of 18, with a consistent income for at least 3 months, you are able toget a phone contract.This is a small way to show credit providers that you are able to pay back debt over time. A phone contract requires you to be able to pay for the device, data and call plan. Or you can pay for just the data and call plan. Either way you will have to repay it over time. The amounts will vary, depending on the plan, but the joy of this is it’s completely up to you what you choose. 

5. Limit the Amount of Credit Applications You Make

When you make an application forcredit, your credit report shows how many times you applied for credit in the past two years. Too many applications in a short period of time can indicate you are a risky borrower and lower yourcredit score. Tocredit providers, it may look like you can’t manage the amount of debt you owe. This can, in turn, bring your overallcredit scoredown.  

6. Check your credit score regularly

You don’t have tocheck your credit scoreevery day, but once every week or few weeks  is good to check if your efforts are paying off. Whether that’s maintaining a goodcredit scoreor building it up, make sure to check your credit score on a regular basis.

7. Take Out a Short Term Loan 

When you apply and get approved for ashort term loan, then pay it back on time (when you agreed to) your credit score improves. This creates a positive increase in yourcreditscore as you were able to pay it back timeously and manage each payment.FASTA is a short term loan provider, where you can get up to R8000. Applying for a short termloan with FASTAmeans that you can get funded in minutes, and repay your loan in up to 3 monthly installments. An instant onlineloan provider in South Africa, like FASTA, means that you can build good credit in a shorter amount of time, instead of taking out a long term loan. 

8. Pay Rent and Household Utilities on Time

These are bills that you accumulate over time and can be easily paid off. Your basic need payments should be taken care of first. Then, what is left of your income can be divided amongst your extra payments. This will allow peace of mind that your bills are paid and your basic needs are met. When you pay on time or early, you eliminate going into arrears. Arrears is when you owe money that you haven’t paid and are late to pay.  

9. Reduce Your Overall Credit Balance

One of the bestways to reduce your creditbalance is to use a percentage of your salary, and use this to pay down your credit balance. Another way you can reduce yourcreditbalance is to pay off your accounts. If you have a store card (for example, from The Foschini Group or Game) it is easier to make those payments first then tackle the big payments if you have to slowly work your way through them. 

10. Close Any Credit Accounts You Aren’t Using 

This may include any store cards that have been paid off and have been left unclosed. It is important to close them as you no longerneed these creditaccounts. You also decrease the risk of anyfraudulent activityoccurring on a credit account that you know is closed. 

Conclusion

Use this blog as a starting point for creating goodcreditand maintaining it. Implementing small changes now will, in the long run, pay off in many ways. Knowing where to start is less overwhelming, so bookmark this blog post for helping youbuild and maintain good credit.