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Resolutions That Pay Off: How To Improve Your Credit Score in 2024

Resolutions That Pay Off: How To Improve Your Credit Score in 2024A cartoon person pushes the needle on “credit score,” scale.As you begin thinking about your New Year’s resolutions, don’t forget to set some financial goals for the upcoming year. Set a goal of improving your credit score to help ensure a bright financial future. A good credit score can help you achieve other goals, such as buying a home, renting a new apartment, or purchasing an automobile.

What Is Credit? Understanding Credit and Credit Scores

If you don’t know much about your credit and credit score, you’re not alone! In fact, in a 2019 study, CNBC found that four out of 10 Americans had no idea how their credit score is determined. For many U.S. consumers, a credit score can feel like a black box shrouded in mystery. In this blog, we hope to clear up some of the fog surrounding credit scores.

A credit score is essentially a three-digit number ranging from 300-850 that indicates your credit risk level, especially when you’re applying for a loan or financing. You may hear your credit score defined as a FICO score. This is because the Fair Isaac Corporation (FICO) created the credit score model. 

Why Do Credit Scores Matter?

For those who are new to learning about credit and credit scores, you may not understand why having a good credit score matters. The reality is that your credit score is taken into account in many different situations.

Credit scores are considered when you need a home loan or mortgage, if you apply to rent an apartment, when applying for credit cards, and more. Lenders typically offer significantly better interest rates on loans to those with better credit scores.

How Are Credit Scores Determined?

You may be wondering how credit scores are determined. FICO breaks down factors influencing your score into percentages, where higher percentages mean a higher impact on your score:

  • 35% payment history. Have you paid off past debt on time (credit card bills, loans, etc.)?
  • 30% accounts owed. How much debt do you have? What percentage of your credit do you use? 
  • 15% length of credit history. How long have you had credit accounts? 
  • 10% credit mix. Do you have a variety of credit accounts? 
  • 10% new credit. Have you opened several new accounts in a short period of time?

How To Improve Your Credit Score Through Good Financial Habits

Apply for a Credit Card if You Don’t Have One

Woman smiles while holding a phone and credit card.

If you’re a student or a younger adult, you may not have many credit accounts yet. While you don’t need a credit card to build your credit score, responsibly using a credit card can go a long way toward improving your score.

When you do end up getting your first credit card, be sure to spend responsibly by paying your balance as soon as possible and only using your credit card for items you can afford. Many consumers opt to use their credit cards exclusively for necessities they can afford, like gas and groceries.

Regularly Monitor Your Credit Usage

Whether you have installment loans, a credit card, or another type of credit account, keeping track of your credit utilization is essential. Look for credit cards that allow you to view usage online, such as Landmark National Bank’s credit cards.

A general rule of thumb is to keep your credit utilization below 30% of your overall limit. For example, this would mean a consumer with a $10,000 credit limit should keep their balance below $3,000. To keep your credit utilization low, pay off your statement frequently. 

Make All Payments on Time

Since payment history is a significant factor when it comes to your credit score, it’s essential to pay credit card bills, loan installments, financing accounts, and mortgage loans on time. Late payments can lower your score and stay on your credit report for months or years.

If you have trouble remembering to make payments, try these strategies:

  • Use autopay when available.
  • Create a reminder on your smartphone’s calendar app to make payments.
  • Set up bill pay reminders if possible.

Review Your Credit Report Frequently and Request Corrections When Needed

Businesswoman reviews credit report for errors, using a laptop and calculator

Your credit score is broken down in detail on your credit report, which is a summary of your credit history and usage. In short, your credit report basically determines your score. Checking your credit report frequently can help you catch potential errors made by the credit agencies that generate the reports and possibly improve your credit score. You can get a free credit report at, a website run by the three major credit bureaus in the U.S.

Build Your Credit With Resources From Landmark National Bank

If you’re ready to take the first steps toward a better credit score, let Landmark National Bank help. Check out our personal credit card options, which can be a great first step toward building credit. If you’re improving your credit score to buy a home, Landmark has home loans that can help you through the process.

Start on your path toward meeting your financial goals with the support of a truly excellent bank. Locate your nearest Landmark National Bank branch to get started. At all our Kansas bank branches, you’ll find friendly banking professionals happy to help you with your banking needs. You can also find more helpful articles on personal finance, budgeting, estate planning, and more on our blog.

How Do Student Loans Affect Your Credit Score?

How Do Student Loans Affect Your Credit Score?

A woman holding a phone that displays her credit score, in front of a latte and a laptop

Student loans are many people’s first ventures into the world of credit. Because of this, it can be confusing to navigate their impact on your financial future.

If you’re feeling lost, you’re not alone — that’s why we’ve put together this factsheet for how student loans affect your credit score.

How Is My Credit Score Calculated?

Your credit score is calculated by weighing your recent and long standing credit activity under multiple categories. There are several credit score types, but the most commonly known is the FICO score, which grades your credibility as a borrower on a scale from 300-850.

The following factors go into calculating your total credit score:

  • Payment history, 35% of your total score — A missed or late payment will hurt your payment history.
  • Credit utilization, 30% of your total score — This portion of your credit score considers the amount you owe against the total amount you can take out. A lower credit utilization ratio generally signals a borrower is not dependent on or overextending their credit.
  • Length of credit history, 15% of your total score — The longer you have a line of credit open, the stronger your credit score.
  • Recent credit activity, 10% of your total score — This indicates your current risk to lenders and will be impacted by the recent opening or closing of one or more lines of credit.
  • Credit mix, 10% of your total score — Shows a diverse use of credit rather than dependency on one form.

By creating a total score based on these factors, where 300 is considered poor and 850 is considered excellent, lenders can determine your risk and responsibility for future credit.

How do student loans affect my credit score?

Student loans are a type of installment loan, meaning you have agreed to pay back a specific amount of money during a set period. Like other loans, student loans appear on your credit report and play a role in building your credit score.

Most commonly, student loans affect your credit score by showing your extensive payment history and length of credit.

How Can Student Loans Hurt My Credit Score?

Your credit score takes a hit by being late or missing a payment. Other instances — like defaulting on your loan — can cause irreparable damage.

Additionally, if you decide to refinance or consolidate your student loans at some point, your longest line of credit will be reconsolidated into a new loan. If your student loan was your longest existing line of credit, this could impact the length of your credit history and lower your credit score accordingly.

Take Steps Toward Success with Landmark National Bank

When building your financial future, partner with a bank that has your back. At Landmark National Bank, our dedicated staff will help you find personal banking solutions that work for your goals — learn more about our services, or find a location near you and open an account today!

Will Closing My Credit Card Hurt My Credit Score?

Will Closing My Credit Card Hurt My Credit Score?

A woman holds a credit card in one hand and a cellphone in the other.

As useful as credit cards can be, it can also be easy to rack up a lot of debt if you’re not careful. Once you’ve paid off that debt, closing a credit card can feel liberating, but how will it impact your credit score? Whether you’re hoping to opt out of an annual fee or reduce your open lines of credit, a moment’s pause can save you years of trouble.

Does closing a credit card hurt my credit score?

In short, it’s possible, at least temporarily.

Your credit score is calculated by examining multiple factors—your payment history, how much you owe, the length of your credit history, types of credit you have, and most recent credit activity—on a weighted scale.

Your recent activity is weighted as 10% of your credit score, and large changes can signal risky behavior to lenders. If you’re on a credit purge, this could really impact your overall credit score.

Closing one line of credit will also shift how you fare in every other calculation.

How will closing a credit card change my credit score?

There are several ways your credit score can be impacted by closing a credit card. Most commonly, it increases the percentage of credit used versus available credit.

For example, suppose you start with three cards with a $1,000 limit each and close two because you’ve only been using $1,000 in credit. Where you were utilizing your credit at 33%, that number now jumps to 100%. This percentage is called your credit utilization ratio.

Ultimately, creditors and lenders like to see a low credit utilization ratio because it theoretically shows you are not overusing or financially dependent on credit. Many financial advisors recommend leaving unused lines of credit open to prevent a significant change in this ratio.

Closing a credit card may also change the length of your payment history. The longer your credit history, the better it is for your score, so closing a card that’s been open for a long time will significantly impact your credit history. If a card is newer, it will have less impact in this way.

Is it bad to close a credit card?

It’s difficult to say whether closing a credit card is strictly good or bad. While it may impact your credit score, it may hold short-term and long-term benefits, such as reducing annual card fees or encouraging you to spend less.

What’s working is generally best left alone, but it’s important to look at all the factors involved before making a decision that works.

How To Close a Credit Card

If you decide to move forward, first pay off any remaining balance on the card, update any recurring payments using that card, and see if you have any unused rewards.

Next, either call the card issuer or cancel online and cut up the physical card. It’s also considered best practice to follow up with a written cancellation request so there’s a paper trail involved.

Lastly, check your credit score. You’ll want to know how your score has been affected for future financial decisions and to ensure the line of credit no longer appears.

Take Your Next Steps with Landmark National Bank

No matter where you’re at in your credit, Landmark National Bank is here to help you along in your financial journey. If you’re ready to break up with your current credit card to find something that perfectly fits your needs, take a look at our personal Visa credit card options. Or, with a variety of personal and business banking options, we’ll help you get where you want to go. Find a Kansas location near you today!