New year, new (improved) credit score? Here's 10 tips to boost your creditworthiness in 2023

When you make an application for credit, the health of your credit score will have a big impact on whether you're accepted for the best deals.

However, even if your credit score isn't the best there are some easy, straightforward ways to give it a boost.

In this article we're going to explain not 1, but 10 (!) ways to enhance your credit score in 2023.

What is a credit score?

Contrary to popular belief, there's no such thing as an 'across the board' credit score. That's because there are three major credit rating agencies in the UK (Experian, Equifax & TransUnion), which all use their own credit scoring systems.

Importantly, each of these agencies calculates their scores differently, and are typically based on a number of variables. For example, how you've handled credit in the past, how much credit you're currently using, and/or whether or not you've missed payments are all likely to contribute some way towards your score.

However, that's not everything you need to know. You see, just because a credit rating agency may have allocated you a score, it's entirely possible another agency has given you a different rating.

The bottom line is, calculating your credit score is all about predicting your future behaviour. Lending money to someone who's unlikely to ever repay what they owe is a bad business move. This is essentially why lenders use the services of credit rating agencies.

Your credit score isn't the 'be all and end all'

Before deciding on whether to accept you for a mortgage, loan, personal loan, or even mobile phone contract, lenders will want to know your creditworthiness. This is to the minimise the risk of having a customer on their books who will fail to repay what they owe.

As we've already covered, lenders may rely on the services of one (or multiple) credit rating agencies. This is why there's no universal credit scoring system. However, it's also worth knowing that even if you have a 'good' credit score, then a lender may still decide to reject you.

The decision on whether or not to lend to you ultimately lies with a lender. In other words, a credit card provider is perfectly within its rights to reject those with good credit scores — they simply don't have to accept the view of individual credit rating agencies. While you may think it would be bizarre to reject a customer with a good credit score, don't forget that lenders often have different priorities when it comes dishing out their cash.

For example, while it may make little sense to lend to an individual who is unlikely to repay what they borrow, a customer with a good level of creditworthiness may have a high score because they ALWAYS repay on time. As a result, these types of customers may never pay interest.

Let's not forget, credit card providers are businesses. This is why lending to individuals with 'OK' credit scores may be a more profitable than lending to those who never miss a payment outside of an interest-free period.

10 Ways to improve your credit score in 2023

While your credit score isn't the 'be all and end all' it's still worth improving your financial attractiveness if you can. While you can never guarantee you'll be accepted for every top deal out there, having a strong score will make it easier for you to be accepted for the best products.

So, without further ado, here are 10 ways to boost your credit score in 2023 and beyond.

1. Check your credit file for errors

Credit rating agencies will typically use your credit file to help them determine your credit score. Your credit file is essentially a document that includes your credit history, including how much you're currently borrowing, and whether or not you've missed repayments in the past.

Yet mistakes can happen, which is why it's worth checking your credit file on a regular basis.

You can check your credit file for free through sites like Totally Money, below. If you spot any mistakes, you should be able to get them rectified.

2. Check your addresses are up to date

Inconsistencies on your credit file may weaken your creditworthiness. So if you've recently moved home it's best inform your provider of your new address as soon as you can. Otherwise you could end up having multiple credit card accounts with different addresses attached to them.

3. Register to vote

Perhaps one of the easiest ways to boost your credit score is to get yourself on the electoral roll. You can do this on the Gov.UK website.

4. Never EVER miss a repayment

It almost goes without saying but missing a payment on a credit card or loan is a big no-no. Not only will you often be charged a £12 fee, but your credit file will show you've failed to make repayments on time. Never, ever miss a repayment. If you can stick to this rule, then you'll find it a lot easier to boost your credit score.

5. Beware of financially linking to others

If you're in a relationship you may choose to have a joint-bank account or be financially linked in the form of another type of joint credit product. There's nothing wrong with this. However, if your partner has a weaker credit score than you it could harm your own creditworthiness.

Also, if you're no longer in a a relationship, always ensure you financially 'de-link' as soon as possible to avoid having your score impacted by someone no longer in your life.

6. Minimise the number of credit applications you make

Every time you make an application for credit a 'hard' credit search is recored on your file. One or two of these searches is no biggie, but lots in a short space of time may give the impression you're desperate for credit.

To reduce the risk of this happening, it's best to use a credit card eligibility checker. These typically use 'soft' credit searches so you can see your chances of acceptance before applying for any card. To learn more, see our article that explains the differences between hard and soft credit searches.

7. Don't withdraw cash on a credit card

While there's no hard and fast rule, withdrawing cash on a credit card often isn't looked favourably by lenders. So while you may get away with one or two visits to a cash machine, it's best not to make a habit of it.

8. Consider credit repair cards

Credit repair cards - also known as 'credit cards for bad credit' - are specialist types of plastic designed for those with shaky credit scores. The idea is that you use these these cards for everyday spending, clear your balance at the end of each month, and you'll be rewarded by an improvement in your credit score after six months or so.

Take a look at our credit cards for bad credit guide for more on how these cards work.

9. Avoid payday loans like the plague

While payday loans aren't as unregulated as they once were, using them for a short-term loan is best avoided. Not only do these types of loans charge hideous rates of interest, but using them can harm your future creditworthiness — especially if you ever miss a repayment.

10. Consider canceling any unused cards

If you've old credit cards you may wish to cancel them. That's because having inactive cards may negatively impact your 'credit utilisation'. This refers to the amount of credit you're using in relation to how much credit you have access to.

To put it another way, if you have credit cards in your name that you no longer have any use for, it's probably best to cancel them in order to give new lenders a more accurate picture of your financial health.

A word of warning about canceling old cards...

While it isn't an exact science, do think twice before canceling a card you've held for a very long time, or one that you use regularly. If you do it could negatively impact your credit score, and/or harm your credit utilisation.

Discover more about your credit score

To learn more about credit scores and why they're important, take a look at our article that explains what is a credit score?