As tariffs, job cuts, and government spending cuts spiral across New York, Philadelphia, Dallas, and other cities, a wave of economic uncertainty looms, casting a shadow over the country. Black migrants and African Americans must rethink their financial futures and explore ways to “secure the bag,” reduce expenses, and boost credit. Yes, boost credit. Credit is key to enhancing financial well-being, choice, and autonomy, even more so in an increasingly uncertain world.
Now, let’s break down the key factors that contribute to building a strong credit score:
- Payment History: 35%
Lenders want to see a history of on-time payments. A single late payment can hurt, so staying consistent, even with minimum payments, helps keep things in good shape. Paying on time is one of the easiest ways to maintain or improve a credit score.
- Amounts Owed: 30%
Credit utilization measures how much available credit is being used. Keeping balances below 30% of the total credit limit shows responsible usage. Paying down high balances quickly makes a big difference. A simple way to check utilization is to divide the total balance by the credit limit and multiply by 100.
- Length of Credit History: 15%
A longer credit history helps show reliability. Keeping old accounts open as long as they’re in good standing can strengthen a credit profile over time. Closing accounts too soon can shorten credit history, which may not work in favor of a strong score.
- Credit Mix: 10%
Lenders like to see a mix of credit types because it shows an ability to handle different kinds of debt responsibly. Credit cards, car loans, or student loans—you name it. While it’s not the biggest factor, in the sense that it only contributes 10% to your credit score, having a variety of credit accounts can be helpful.
“The way to get started is to quit talking and begin doing. Make a budget and stick to it.” —Walt Disney
