What's up you guys, it's graham here, so we got ta talk about one of the most important things on the planet and no, it's not me asking you to smash the like button and claim your four free stocks down below in the description. Instead, this is about your credit and some easy ways to instantly boost up your score. Arguably, i think this is one of the most simple, yet misunderstood aspects of personal finance, because of how little this is talked about and how villainized credit could be from people who don't like debt anyway, regardless of how you feel about credit, the reality is that this Is one of the most important aspects of personal finance? Your credit score can quite literally be the difference in you, building your net worth getting the best deals on real estate and getting free stuff or paying out the no's in unnecessary interest. Because you didn't take this seriously and the best part about this entire video and getting to do all of this is that it's totally free.

The only thing this is going to cost. You is a little bit of your time and smashing the like button on the video to help me out and really that's it and, if you're feeling extra generous, you can even leave a comment down below for me to read. And yes, i do read like 95 of them, not to mention there's recently been some changes to the credit scoring algorithm. So it's really important for me to update this video.

So now it's as accurate as possible. Thank you so much. It means a lot and with that said, let's begin the video all right so first to bring everyone up to speed. Here's a really quick background on exactly what your credit is, why it's important and how your score is calculated.

Your credit score is really just like your grades that banks and lenders look at to determine whether or not they're going to lend you money and what interest rate they're going to be charging you so anytime, you go and apply for an auto loan, a mortgage, a Credit card, or even when you go and rent an apartment, they'll check, what's called your fico score and then they'll make the decision as to whether or not you're a worthy borrower. Based on where you fall on a scale of 300 to 850., the higher the score you have, the better you're perceived at handling money and therefore the lower the risk you are and the lower the interest you'll pay. But if you have a low score below 680 or so, oh no, if that happens, they're either going to reject you entirely or they're gon na be charging you so much money and interest because, statistically you have a higher likelihood of not making a payment or defaulting, But thankfully, though, there is a solution, even if you have no credit bad credit or you just want your score to go higher because after a while, it's like trying to achieve a top score in a video game. Not to worry.

There are some simple tricks that you could use to boost up your score, even higher. The first and largest factor is based on your on-time payment history, and that makes up 35 of your score. This means you always pay your bills on time, as agreed, without ever missing or being late on a payment and needless to say, because of how much your credit is weighted towards on-time payments, if you're ever late or miss anything, it's pretty devastating to your score. The second largest impact is what's known as the amounts owed or credit utilization, which makes up 30 of your score.

This is really just a calculation that takes into account how much credit you have available to you versus how much of that you actually use. If you're someone who maxes out all of your cards or you use almost all the credit available to you, that's going to lower your score because you're seen as a riskier borrower, the third we have the average age of your credit history, and that makes up 15 Of your score overall lenders see that the longer you've had your accounts, open for and in good standing, the higher the chances are that you're going to be a responsible, experienced borrower. Then. Fourth, we have the types of credit that you have, and that makes up 10 of your credit score.

This means that lenders want you to have experience, handling multiple types of loans, just to prove to them that you're, a financially responsible adult who knows how to handle credit cards, an auto payment, lease payments, a mortgage and so on, and finally, that last remaining 10 of Your credit score is calculated based on the number of credit inquiries. You have see any time you go and apply for a new line of credit. It's going to show as a hard inquiry on your report. Now, generally speaking, the more hard inquiries you have, the lower your credit score is going to be.

That's because lenders are worried that you're actively out there trying to get as much credit as possible and because of that you're seen as a higher risk, and that lowers your score now, whether or not you agree with this whole system, it is what it is and From my perspective, it's better to play the game to win than avoid it entirely. So now that you know how all of this works here are some methods that you could begin using to instantly boost up your credit score. First, you're going to need to go and view your credit score by either signing up for free at creditkarma.com, or you could get your actual credit report and score for free once a year at annualcreditreport.com and if any websites ever ask you to pay. For your credit report just say no to it, because there's no point in paying for something: that's already free, but once you see your reports, you're going to be able to look through it and see which items can be improved to help increase your score.

And usually it's going to be one of these one. You don't have enough credit if you're relatively new to this or you haven't, had enough time to open up a credit card and make on-time payments. Then most likely your score is not high because you don't have enough history. Yet if that's the case, don't worry i'll.

Go over some solutions to this later on the second, maybe you have a late payment or two or three or g's, even more than that, if that's the case, any late payments like this are gon na stay on your report for seven years, which is a lot Of bad luck for your credit score, but thankfully there are some ways around this that again i'll cover shortly now. Third check to see if you have any accounts and collections and i'm not gon na lie. If you do that's pretty bad now for anyone not aware this is what happens when you're so late on a payment by usually more than 180 days, that your lender just charges it off as a total loss and then they'll sell that debt to a third party Debt collections agency, who will then call you non-stop, just asking you to pay it off fourth check to see if you have any high balances or any maxed out credit lines. This is what happens when you charge or borrow the maximum you're allowed or very close to it.

When this happens, lenders see you as a bigger risk, because otherwise, why would you be maxing out all your credit cards and because of that, your score is lowered and fifth check to see if there are any bankruptcies or foreclosures on your credit report now this should Be an obvious one, but sometimes marks like this are left on accidentally longer than they should be, where some people might have misinformation on there or have had their identity stolen. So once you see, what's affecting your score, you'll be able to better target that and then fix it, but generally speaking, these will have the quickest impact one, if you don't have enough credit, but you want to increase your credit score immediately. One of the fastest life hacks out there is to be what's called an authorized user. This is what happens when somebody else with an extensive credit.

History adds you as an authorized user to their credit card, and when that happens, their credit history is going to be showing up on your account. This term is also known as credit piggybacking, because essentially you're able to get all the benefits of someone else's score without you needing to do all the work. Typically, this is something i would recommend parents do with their children if you want to give them a head start on their credit, or if you have someone you explicitly trust you could do this to help them out. You don't even need to give them the physical card for them to spend money on either as long as you're just placed as an authorized user.

It could help you out. However, there are a few catches when it comes to this, because you know what they say. If it sounds too good to be true, it probably is, unless it's you getting four free stocks down below in the description when you deposit a hundred dollars on weeble, because that is not too good to be true, but the offer does expire shortly. So if you haven't done that yet now is the chance to do that anyway.

Catch number one is that some credit cards are catching on to this, and because of that they're not going to be reporting, the authorized users account history to all three credit bureaus when accounting for your score. As of now, it appears as though capital one discover bank of america and wells fargo are the only accounts that will transfer over past history and other credit cards will only begin reporting at the time you're put on their account. So essentially, this is the same thing as you going and just getting a new credit card so make sure to do your research ahead of time so that the past history is going to be showing up in your account now catch number two: is that because everything Is going to be transferred over to your account that also includes late payments? You need to make sure the person who adds you as an authorized user has at least three to five years worth of credit history, no late payments, no high balances and no other derogatory marks that could bring down your score in the past or in the future. So, overall doing this is a good option if you have a close family, member or friend, who's willing to add you on as an authorized user, and doing this correctly can instantly boost up your score and don't get me wrong doing.

This is definitely not a substitute for building up your own credit, but it could certainly speed things up. Two pay off your balances so that your utilization is below 10. I would say for most people this would make the biggest difference for their credit score in the shortest amount of time. Remember the amount you owe known as your utilization rate makes up 30 of your score.

So if you keep a high balance on your credit cards, that's absolutely going to have a very negative impact. So in this case, you have two options: number one would be pay down the balance of your credit card, and once this happens, a higher score will usually be reflected within 14 to 30 days and also fun fact. But the credit scoring algorithm just recently changed and now they'll be taking into account the average account balances and utilization rate over time. That means that if you have a history of maxing out your credit lines or carrying a high balance, that will negatively impact your score.

So if you can do your best to keep your balances as low as possible or always pay off your credit cards in full and that's going to give you the highest score now, obviously you might be thinking, but graham that's easy for you to say not. Everyone could just pay off their credit cards and i got ta say that's true, but if this is you and you can't pay off your credit lines, i know this sounds completely counterintuitive, but sometimes getting a credit limit increase or opening up a new credit card will Actually help solve this problem. Here's why your utilization rate is based on the total amount of credit that you have available to you, meaning if you have five thousand dollars worth of credit and you charged up all five thousand dollars of that. That's bad because you're using a hundred percent of your available credit.

But if you open up a new credit line and now you have ten thousand dollars worth of available credit, and you still have that same five thousand dollar balance now you're. Only using fifty percent, which is still kind of bad, but it's not horrible. That's why i recommend to open up as many no fee annual credit cards as you possibly can to increase your credit utilization, or you could also ask your credit cards to increase your total credit limit. Doing so is going to decrease your overall utilization and long term.

That's going to help your score now. Obviously, if you have a spending problem and those high limits got you into trouble in the first place, then don't do this if this is gon na mean you're just gon na charge up more money to the credit cards, but from a tactical standpoint, if you have The self-control not to spend any of that extra money, increasing your credit lines or getting new credit, will make your current balance smaller in comparison, although, ideally just make sure you always pay off your credit cards in full by the time they're due and you'll never have To worry about this now, the third thing you could do to increase your score, and this is brand new. It's something called experian boost. Now, here's the thing when calculating your credit score, a large portion of that score is calculated based on how many on-time payments you've had the account history and the types of loans you've been given.

But obviously that requires you to open up multiple credit cards and then pay them all off on time, but in a new credit scoring model experian boost aims to fix that, and most of you would be able to qualify. None of this is sponsored by the way, but experian boost is a free opt-in service that links your accounts and then tracks on-time phone and utility payments by adding them as a positive trade line on your experian credit file. Doing this is going to give you more positive credit history and more positive trade lines to help out your credit score. They also offer you a whole bunch of other free products and services so for anyone who's wanting to boost up your credit score.

I would highly recommend this, except if you don't pay your phone and utility bills on time which that's a no-brainer, and if that's you i mean come on, you got to pay those on time next. The fourth thing you could do to increase your credit score is to remove late payments and delinquencies from your account. Remember anytime, you miss a payment or anything gets sent to collections. It's absolutely going to destroy your credit score, but if that happens, not all hope is lost.

If you have any type of late payment right now, just be aware that it only gets worse the longer you wait. For example, a 90-day late payment is going to impact your credit score much worse than a 60-day late payment than a 30-day late payment and so on. So if you find yourself in this position with late payments or any delinquencies, here's what you could do to fix that one pay off any late amounts as soon as possible. This one only gets worse over time.

So it's much better for you to have a 30-day late payment on your account than a 60-day late payment, even if it means you're only making the minimum payments on this. A minimum payment is much better than having a late payment. Two. It's always worth it to try to negotiate the terms of the debt, to bring your account back to current if at all possible.

This means you could reach out to the lender and, if you're having difficulty making the payments right now try to work something out or you could try to negotiate paying something upfront to bring your account back to current. The reality is that late payments like this are notorious just for being charged off entirely and the bank never gets anything back in return, so most companies would rather negotiate with you to get something back than nothing at all the three. If you've already paid off the debt, but the late payment is still on your report, just call up the lender and see if they will remove it as a courtesy. Now i just want to make this clear, but they're not obligated to do this at all, but you might have heard of the saying you could catch more flies with honey than with vinegar, and i think sometimes just by calling and asking and being polite, it might Go a long way now.

Fourth, if all of that fails, look for any inaccuracies on your report and then dispute it. If you find any discrepancies in the amount you owed the due dates or anything else like this, you could dispute the late payment as inaccurate and if they cannot prove that everything is correct, they will have to remove it doing. This should absolutely make a huge difference in your credit score in a relatively short amount of time, for really just an hour's worth of your work and number five, the big one from all of this, don't close any of your accounts. I guess this one is more.

Like a what not to do, but i've seen it happen so many times, and it's worth mentioning because your credit score is calculated by the average age of your account history. That starts with the age of your oldest account. But what happens if you close out that old accounts, because you just don't use it anymore? What you're really doing is erasing your oldest account history, and when that happens, it's going to look like you have a much newer account than you actually do and when that happens, your credit score is going to drop. So as a preventative measure, don't close out any of your old accounts, even if you don't use them, the rule of thumb is that if your credit card has no annual fee, always keep it open and just every now and then charge a one dollar amazon gift Card to the card to keep it active and if your card does have an annual fee and you don't use the card enough to justify it, consider calling up the credit card company and downgrading it to a free option.

So that way, you keep all the credit history, but you pay no annual fee by doing this and making sure you keep all of your credit cards in good standing and active you'll help keep your credit score as high as possible for as long as possible and, Lastly, i just want to say: there's no need to pay anyone for credit repair services and ignore all of those spam comments praising someone for increasing their credit score. All of this is something you could do yourself for totally free in under an hour, and it's very easy to do yourself. So those are my tips and techniques to boost up your credit score as much as you can in as little time as possible. By doing this and raising your credit score above 750 or so you're gon na be getting the best rates anytime, you get a mortgage, an auto loan.

You can sign up for new credit cards, get a whole bunch of free stuff, get a whole bunch of rewards, and this just opens you up to so many new opportunities that save you money. That would not be possible without a good credit score. So with that said, you guys thank you so much for watching. I really appreciate it as always make sure to destroy the like button.

Subscribe button and notification bell also feel free to add me on instagram. My posts are pretty much daily, so if you want to be a part of it, there feel free to add me there. As on my second channel, the gram stefan show i post there every single day - i'm not posting here. So if you want to see a brand new video from me every single day, make sure to add yourself to that.

And lastly, if you guys want four free stocks, use the link down below in the description and weeble is going to be giving you four free stocks when you deposit a hundred dollars on the platform with those stocks potentially worth all the way up to 1 600. So if you want the free stocks, use the link down below, let me know which ones you get. Thank you so much for watching and until next time.