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A high Credit Score is the dream of every company seeking investment inflows and future supply. A good credit management strategy can go a long way in ensuring that you realize this dream. Some of the most important features of a good credit management strategy include; • Keeping your debts at manageable levels – Having debts taking a huge part of your income means not only that you have slim savings but also less room to navigate in case emergencies arise. Your credit taking habits would determine the level of riskiness that a creditor perceives of you. • Servicing your debts promptly and appropriately –Being late in servicing your debts would indicate that either you are not a serious and committed debtor or you are financially constrained which would decrease your credit score. • Ensuring that your net worth remains on an upward trend –Your net worth is the difference between your total debts and your total assets. A growing net worth would indicate that your debt is being efficiently utilized in increasing your wealth which is a plus to your credit score. • Keep a good history of your credit transactions – Your credit score depends highly on your credit history. The longer a good credit history is, the higher the score you are likely going to get. • Only get credit when necessary – Getting credit when necessary would ensure that your credit is used to further your financial wellbeing. This wellbeing may translate in either improved incomes or savings or both. Whichever case, this will reduce the likelihood of default or being rendered worse off after taking the credit. • Ensure that errors and mistakes on your account statement are corrected as soon as they arise – errors and mistakes distort your true credit position. When there is a mistake or error that results in your payment being indicated as delayed, or where you are penalized or overcharged, these contribute to weakening your credit score. The earlier the error is reversed, the faster its effect is smoothened out. • Have healthy communication with your creditors – It is good to ensure healthy communication with your creditors. This not only boosts your goodwill, but improves your ability to get further credit. • Keep off Insolvency or bankruptcy - In case of difficulty; propose installment restructuring to avoid default and penalties. At worst, avoid insolvency or bankruptcy. Author is an experienced content writer & publisher who write article on credit insurance companies & credit insurance broker.
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