Your credit score determines the likelihood of getting approved for a loan, and how high your interest rates will be. But, for most people, they don’t know the steps they need to take to improve their scores.
We sat down with a financial planner, who says the first step is simple.

David Wald; Financial planner: “make you pay your bills on time. 35% of your credit score is basically looking at your credit history and making sure you’re paying on time.”

If you’re already making your payment deadlines, Wald says the next step is to pay off any high revolving debt. Statistically, the older you are, the better your credit score will be, leaving millennials as the generation with the worst scores. Wald explains how young adults can build credit when things like student loans work against them.

David Wald; Financial Planner: “Dabbling with a credit card, a small credit card, maybe a 500 dollar balance so you have a governor on your spending. Start out with that and make sure you pay it off every month. That’s going to establish a credit score for you and if you’re paying it off, you’re not accumulating that high-interest revolving credit.”

According to Experian, millennials had an average VantageScore of 638 in 2017, well below the overall average score of 675.