3. Always consider your credit score
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Whether adding or subtracting to your credit profile, it’s important to consider what effect the move is going to have on your credit score. Of course, to do so, you’ll need to know what your credit score actually is. Consumers should check their credit reports at least once a year. You can do this for free by visiting www.annualcreditreport.com. You can also monitor your score for free with the Credit Report Card.
As a best practice, you should also pull your credit report right before applying for a new loan. If the score turns out to be less than stellar, you may want to focus on building it before you add any credit cards or installment loans. If your credit score is in good shape, be sure to reap the benefits.
“Be creditworthy when the opportunity arises,” Carlson says, so you can get the best interest rates on each line of credit. You’ll also be eligible to score the best rewards credit cards.