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5 Totally Debt-Free Ways to Boost Your Credit

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How Do I Improve My Credit Score Without Debt?

It’s the good ol’ personal finance Catch 22: You need credit to get credit. But what many people might not realize is that you don’t necessarily need debt to get credit. Or, backing up for a second, you don’t necessarily need to carry debt to improve your credit scores. In fact, if you’re looking for how to improve your credit scores fast, your best bet involves paying down high balances on revolving lines of credit, like a credit card or home equity line of credit. But let’s break down your debt-less options further. Here are some ways you can improve your credit scores without going in the red.  

1. Get a Credit Card

We know, we know: Getting a credit card sounds like the quickest way to wind up making purchases you can’t actually afford. But, remember, the best way to improve a credit score is to make on-time payments on any financing. (Payment history accounts for 35% of a credit score.) Sure, most installment loans, like a mortgage, auto loan or student loan, require taking out a lump sum of money (meaning debt) and paying it back over a set period of time. But when it comes revolving loans — and particularly credit cards — there’s absolutely no need to carry a balance month-to-month. Instead, qualifying for a low-limit credit card is all you need. Make a few small charges each month and pay your account in full, and on time, each and every month.

Remember, keeping charges below 10% of your credit card’s limit is good for your credit score as well. So if you have a card with a $500 limit, keeping your monthly charges below $50 is also a good, credit-building strategy.

2. Opt for a Secured Credit Card

If you are unable to qualify for an unsecured credit card because you are new to credit or have made credit mistakes in the past, you can apply for a secured card instead.

With a secured card, you make a small deposit, typically a couple hundred dollars, with a credit card issuer. And your card’s credit line is your deposit minus any fees charged by the card issuer.

Make sure you choose a secured card that is reported to each of the three major credit reporting agencies — Equifax, Experian and TransUnion. Then, make steady on-time payments with a secured card and keep charges below 10% of your credit line. And after a year of on-time payments, consider asking your issuer for an unsecured credit card.

3. Look Into Credit Builder Loans

A credit-builder loan is the installment loan version of a secured credit card. “Borrowers” put a small amount of money (around $500 or less) into a savings account at a bank and then make fixed monthly payments each month until they’ve “paid back” the money and have access to the money again. Credit builder loans are designed specifically to help people with thin-to-bad credit demonstrate their ability-to-repay, so, yes, the bank should be reporting the payments to the major credit bureaus. Note: You’ll want to double-check with a prospective financial institution before taking one out. Plus, some banks pay (albeit a very, very, very small amount of) interest on their credit builder loans, so you could wind up pocketing a few extra dollars from that deposit.

4. Become an Authorized User

If you don’t feel ready for your own credit card or simply can’t qualify for one, you can see if a family member, like a spouse, parent or guardian, will add you as an authorized user to their credit card account. An authorized user can make charges to the account, but they’re not responsible for actually paying them back. That’s the primary cardholder’s responsibility.

Many banks and issuers report their authorized users to the credit bureaus (again, you’ll want to check with the primary cardholder’s lender ahead of time), so positive information associated with the account can help you build credit. And, given you’re not liable for the charges, negative information can be disputed and removed, should it appear on your credit report. Of course, you’ll want to use a card that your family member or loved one gives you responsibly — or not at all, because, in this instance, so long as they’re using the card responsibly, you’ll build credit.

5. Monitor Your Progress

You can keep track of your credit-building with’s free credit report summary. You’ll receive two free credit scores and a customized plan to help you build your credit. 

Remember: The key is building a good, solid payment record, not acquiring debt. Only charge what you can pay off each month, and maximize your credit-building efforts by following the 10% rule. Then, pay your bills on time and watch your credit scores climb.

How Long Will it Take to Improve My Credit Score?

Keep in mind, building good credit won’t happen overnight and timeframes will vary, depending on your overall credit profile. However, six months of on-time payments is usually a good timeframe for getting your foot in the door if your credit was previously non-existent. And, if you have high credit card balances on record, you could conceivably see a boost in 30 days by paying a big chunk of them down (and refraining from making new charges, of course).

It’s also possible to see a boost in 30 to 45 days if your credit is being weighed down by a legitimate error. (You can learn more about disputing errors here.) Still, to keep solid credit in the long-term, you’ll want to make all payments on time, keep debt levels low, be careful about incurring too many credit inquiries and add a mix of credit accounts (installment vs. revolving loans, for instance) as you can afford to.

Lucy Lazarony contributed to the reporting of this article.

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  • Dan

    4 years ago I bought a house and at that time my credit score was something like 750. 3 years ago I paid off and cancelled my credit cards, then I paid off my house. I have never borrowed any money since paying off the house, I currently have no debt of any kind. How would my credit score look today.

    • Credit Experts

      You could check it yourself to see. Here’s how to monitor your credit score for free. It is also possible you have become a “credit ghost” without a score. You can read more about that, plus what to do, here:
      Have You Become a Credit Ghost?

    • mjf

      Look at it, maybe freeze your credit can freeze it..good to keep it above 700 even though your home and cars and depts are all paid for..times and circumstances in life can change rapid fast and its good for emergencys to always have that security to fall back on having good credit..

  • Ketan Patel

    Hi Guys,
    I met a Credit Counsellor, and looking at my credit report, she suggested me to open a Loan account in a Credit Union.
    I have opened a Loan account of $1000, and have deposited $1100 in the savings account, and have setup an autopay for each month.
    My credit card limit is $1000 on a secured credit card on my name and $1500 as a authorized user, I pay every 14 days, and keep my balances really low, and before due date i pay the rest. I dont have any other active debt, other than 3 charged off accounts, that were closed 3 years ago. I pay on time, zero balances, still my score is very slowing growing.
    Question: The bank where i opened this loan account, the lady suggested that, I can open one more loan account, this should double the score that is being reported at the end of the month. Does it work? Having two different loan accounts from same bank, will bump scoring every month? Same Creditor?
    Also, this is a Loan, so my credit balance/limit will be $2000 now when some is pulling my credit, whereas i have a credit limit of $2400 from both the card. Will this start lowering the score, since my debt will grow?
    Please do provide your expert suggestions, i am in process of rebuilding my credit.

    • Gerri Detweiler

      A second loan isn’t necessarily going to “double” the score. It may help, since you will have two current, paid on time credit references (rather than just one) but it will take time for that new reference to help your scores. (The fact that it is the same creditor shouldn’t matter if they are reported as separate loans).

      I am not sure what you mean by your debt/limit. Are you talking about the utilization or debt usage ratio? That will be calculated on each account separately as well as with both combined.

      • Ketan Patel

        Thanks Gerri for your guidance. Debt to Limit – I was asking about utilization. I owe one credit card with a limit of $1000 and another one I am an authorized user with a limit of $1500. Both the cards are paid before due date in full, but still utilization is around 17%, I guess when I make some charges after due date and before CC reports on my credit file, some amount is reported by them.

        Now second loan, if I take for $1000 more, does this affect the Credit Usage.
        As of now on Experian I am seeing my Credit Debt is $266, total credit is $2000 (increased credit line of $500 hasn’t been updated yet), but its show CREDIT USAGE 14%. Does this will go up, since next month, I will have $2500 in credit limit plus now I will have 2 loan accounts of $2000 total, each of $1000.



        • Gerri Detweiler

          17% or 14% isn’t terrible by any means. I am having a bit of trouble following your comment, but your new credit limit will increase the aggregate credit limits and if the balance is small can improve your debt usage overall, though scores often look at it individually (per account) as well. Perhaps this article will help: Tips for Improving Your Credit: Your Amount of Debt

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