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A great credit score is one of the best gifts you can give yourself. You won’t have to worry whether you’re likely to be approved for a new credit card, auto loan, or even to finance a living room couch.

You’ll also qualify for lower interest rates when you borrow — this can be especially impactful when you borrow money for a big purchase, like a house.

If you’ve set your sights on better credit in the new year, here’s how to get there.

1. Recommit to on-time payments

The most important thing you can do for your credit score is make every single payment to your creditors on time, every month. Payment history is the biggest factor in your FICO® Score, making up 35% of it. It makes sense — lenders want to know whether you’ll pay them back if they lend you money, after all.

So if you’ve been a bit lax about this in the past, make the effort to really lean in and pay on time. Set up autopay for loans and credit cards if you struggle with forgetting due dates, or do what I do with my credit cards: pay them every single week (or whenever you get a paycheck).

That way, you’ll be assured your payment is never late, and you’ll get to make smaller payments each time.

2. Focus on debt payoff

Debt payoff was a major item on my to-do list for 2022, and I watched my credit score grow by 100 points by the time I was out of debt. Credit utilization ratio (the amount of credit you’re using vs. the amount you have) is a major part of your FICO® Score — it’s the second-most important factor after payment history.

You might assume the best way to tackle debt payoff is to cut every last bit of fun spending out of your life and huddle under a 40-watt light bulb eating ramen every night. You’d be wrong, though.

Yes, it’s worth seeing where you can make mostly painless cuts — if you usually order takeout three times a week, can you cut back to just once? The more effective way to get out of debt is to grow your income, though.

I originally started freelancing with a goal of paying off debt and saving to buy a home. Since none of the freelance money I was earning was already committed to bills, I could just funnel all of it (less taxes) to my debt payoff, and then to savings for a house after I was out of debt.

If you’ve got some free time and an enterprising spirit, consider boosting your income with a side hustle or taking on extra work (and extra dollars) at your regular job.

3. Check your credit reports regularly

Credit report errors could be dragging your score down, and they’re extremely common. In a study by Consumer Reports and WorkMoney, 44% of those surveyed reported finding at least one error on theirs.

Good news, though: You can check your credit reports for free at AnnualCreditReport.com. It’s worth doing this a few times a year, especially before you apply to borrow money.

Examples of errors you might find include mistakes in your name or address, closed accounts being reported as still open, and late payments that were made on time.

If you spot problems like these, reach out to the credit bureau that generated the report and request that they be removed (you’ll have to provide proof, like a monthly statement from your credit card issuer).

4. Hold steady with your credit accounts

If you want better credit in the new year, consider holding off on applying for new credit for a while. Every time you apply for a loan or a credit card, the lender runs a hard credit check that dings your credit score by a few points.

It’s no big deal to do this every so often, but if you’re trying to boost your score, it’s a good idea to space out applications even more. And while you’re at it, keep old accounts open, as they’ll lengthen your credit history, which is also a contributing factor to a higher credit score.

5. Consider a secured credit card

Finally, if you’re building credit for the first time or rebuilding from past missteps (you got this!), it’s worth exploring secured credit cards to give yourself a leg up.

These cards work differently from traditional credit cards in that your credit limit doesn’t come from the card issuer, but from a security deposit you make when you open the account. If you put down $500, you’ll get a $500 credit limit that you can spend against and repay.

As you make your monthly payments, the card issuer will report your positive credit behavior to the credit bureaus and your credit score will increase. Eventually, you may be able to “graduate” to a regular unsecured card, and you’ll get your security deposit back.

We’ve rounded up the best secured credit cards — click here for card options to help you build a strong credit score.

You could do worse than focusing on building up your credit in the new year. After all, a higher credit score could help you save money on interest when you borrow money. It could also lead to cheaper insurance, an easier time getting hired, and more. Add these tasks to your list of 2025 money moves for the best results.

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