How to fix a credit score or even how to improve a credit score is a hotly debated concept these days. Especially wit

h the current state of the economy, many people are plagued with bad credit and are looking for ways to get a higher credit score to get better interest rates or even to buy a house.

The thing is, who do you follow or who do you even trust? Afterall, it’s hard to even listen to governments. With some of them looking at going into default, even they seem to have credit issues.

That being said, here are a few notes on common misbeliefs regarding credit and how to improve your credit.

You may have heard some of these things in your time. I bet you may be surprised to see that some of them are just plain bad advice.

Three Myths in Boosting a Credit Score

Credit building is one of the many things in life that can sometimes revolve around myths. People think that there are certain things they do that increases their score even if these things really do not impact their scores in any way. The truth is there are really no easy credit score fixes just like what commercials claim. The simple formula to credit score improvement is having good payment behavior and possessing a healthy mix of credit. Here are some of the wrong beliefs that are not helpful in boosting your credit score.

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Credit Improvement Myth # 1: Choosing to get rid of credit card offers will help

John Ulzeimer, SmartCredit.com’s consumer education president, said that it is a common belief among people that if they choose to get out of credit card offers, the credit inquiries in their reports will be lesser. But, the truth is, these inquiries are “soft” and do not really affect the score. He further adds that people can still welcome the offers but it will not strengthen their credit scores.

Credit Fix Myth # 2: Closing old accounts improves score

Trey Loughran, Equifax’ personal information solutions’ President, says that closing your accounts are not really helpful to a credit score. It can even cause a slight damage by shortening your credit history and leaving you with a minimal amount of remaining credit.

Credit Repair Myth # 3: Opening more accounts helps boost credit score.

Several consumers experiencing problems in their credit think that having many accounts will show that they can manage credit. Actually, this has a reverse effect. According to Experian’s public education director, Rod Griffin, more accounts will make lenders wonder why all those credit are needed. He added that it is even a sign of risk that can make your credit score suffer. What lenders will actually see if you have several accounts is the number of hard inquiries in your report. Those inquiries will decrease your score and lenders will worry that you might be in dire need of financial help because you are gaining access to too much credit.

So, while you are working to get that perfect 800 credit score, just know that there are some things that will help you and some things that are just plain malarky.

Here’s to your credit and financial freedom!

Related articles

• 8 Credit Score Myths Debunked (abcnews.go.com)
• Four Horribly False Credit Score Myths (mint.com)

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A lot of people have made various attempts to fix their financial situation. However, majority of these people failed. This is because financial resolutions need a long-term behavioral change which is very difficult but not impossible to do. There are other things that can be done to fix one’s finances aside from saving and spending less. Here are three tips to try to be able to manage your money better.

First, obtain a free copy of your credit report. The legislation in 2003 entitles all Americans to an annual free copy of their credit report. Each of the three credit bureaus must provide this copy. It can be obtained via AnnualCreditReport.com.

Despite this privilege, survey shows that almost 2/3 of Americans do not order a copy of their report. Getting hold of one’s report is important because it allows you to understand your credit score. It also helps in identifying errors and disputing them so that changes can be made that will help you obtain loans and additional credit for purchasing your needs. Aside from this, credit ratings these days determine employment. If you are planning to apply for a job, you must know your credit standing to see if it will affect your job application.

Second, go through a medical exam. This is a preventive measure rather than a direct solution to a financial challenge. By going through a medical exam, health care expenses are significantly reduced. This is because minor health problems are addressed early on before the condition gets worse.

Finally, update your beneficiaries. Deaths are inevitable and there are plenty of cases wherein the insurance proceeds go to someone else. Sometimes, this is not the intention of the bereaved family member but since the update was not made prior to death, there is nothing he or she can do about it. Remember that the name indicated as the beneficiary will be the person who will be receiving the proceeds of the insurance.

This holds true even if the will of the dead family member states that it must go to his or her spouse or children. Updating of beneficiaries should be done every time a major life change such as marriage, divorce, child birth or spouse’ death occurs. Accounts that usually need beneficiary designations include the following: 401k, 403, 457 plans, retirement plans for the self-employed, individual retirement accounts or IRAs, credit union plans, disability and life insurance policies and annuities.