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Good credit allows the average person the basics in life: food, shelter, and clothing. In a modern society, these basic needs are purchased with some form of monetary exchange. Without a good credit rating, average people struggle to put food on the table and a roof over their heads. Good credit is needed for anyone wishing to buy property, secure a loan or mortgage, obtain a credit card, or get a job.

Good credit is determined by the numerical ranking of your personal credit score or FICO score. This number will range from 300 to 850. The higher the number, the better the credit score. Several areas of information taken from the last seven years determine a credit score: age, social security number, employment status and history, marital status, current and previous residential addresses, and any borrowing history including all loans, banking history, and bankruptcies.

Personal credit card history also factors into a credit score. This data includes how long a person has owned their credit cards, how many cards are owned, the maximum amount allowed on the card, the current balances, and payment history.

Why should you know your credit score?

By keeping track of your credit ranking, you can work towards raising it. Remember, the higher the better. Get the number as close to 850 and be considered a good credit risk when applying for any type of loan. A good credit ranking can even help you get a job. Many employers perform credit checks on prospective employees. A person with an unstable credit history might be passed over. Employers want reliable employees and a history of missed loan payments indicates a level of irresponsibility.

How do I find my credit score?

Credit scores are available through any of the three main credit agencies: TransUnion, Experian, and Equifax. To monitor personal credit scores, consider a service like Triple Advantage Credit Monitoring.

What can hurt a credit score?

Several factors can hurt a credit score: late or skipped payments, bankruptcy, multiple credit cards, maxed-out or extreme high balances on credit cards, and even taking out too many applications for credit. Most stores have their own card and want you to have it too. Limit your department store cards to five or less. It is tempting to open the account to get the 20 percent off at the register, but opening the card even if you do not use it, will affect your credit ranking.

Overdrawn checking accounts will affect a credit ranking negatively.

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