When it comes to credit, avoid these two mistakes

Mistake No. 1: Opening additional lines of credit to get a discount

Department stores and other retailers are known to promote credit facilities they offer with 10 to 20 percent discounts if you open a credit line or store credit card. This has implications on your credit score. Most store cards offer very low credit limit and you max out the limit with one or two purchases. The ratio of credit limit to outstanding balance is what negatively affects your credit score in this case. One solution is to use an existing credit card to make a purchase rather than opening and immediately maximizing the limit.

Mistake No.2: Relying on medical insurance to pay your medical bills

Many of us carry medical insurance and rely on them to pay for medical, prescription and other services such as ambulance services. If you refuse to pay a medical bill because you think it is medical insurance’s responsibility, think again. It doesn’t matter whether it is a medical bill or not. If you are late paying it, it will affect your credit and lower your credit score. If you can, pay the bill first and deal with your medical insurance later for reimbursement.