What's In A Credit Score?

What’s in a Credit Score?

Let’s explore ways to create new financial habits and increase your credit score. We want you to be in tip-top shape financially which means establishing and maintaining good credit, regularly contributing to a savings account or investment account and topping up your RRSP’s and RESP’s.

Credit score insight: Canadian credit scores are calculated by two major credit bureaus: Equifax and TransUnion. Factors that are used to calculate your credit scores are your payment history, how much debt you have and how long you have been using credit. It’s a great idea to check your credit score occasionally and you can do so with both bureaus by mail. If you would prefer online, Credit Karma is a great place to start.

What does my credit score mean according to Credit Karma?

· 800 to 900: Congratulations! You have excellent credit. Keep reaching for the stars!

· 720 to 799: You have very good credit! You should expect to have a variety of credit choices, so continue your healthy financial habits.

· 650 to 719: This is considered good to lenders. You may not qualify for the lowest interest rates available but keep your credit history strong to help build your credit health.

· 600 to 649: This is fair credit. History of debt repayment will be important to demonstrate your solid sense of financial responsibility.

Simple ways to Increase Your Credit Score:

1. Always pay your bills on time
2. Keep your balances low
3. Maintain a credit utilization ratio of less than 30 percent
4. Tackle your debt
5. Avoid using your credit cards to pay for large purchases

Good Financial Habits to Cultivate Now:

1. Check your credit report (click on any of the links above to get started).
2. Set up automatic payments for your bills or regular payments.
3. If you’re young or have a short credit history, avoid opening several new accounts at once.
4. It’s never too late to repair your credit so start with little steps today!