I built my credit limit from £200 to £3,000 and my credit score from absolutely nothing to ‘good’ within less than a year. Now, after having credit for less than two years my credit score is ‘excellent’ on all three major credit agencies – Equifax, Experian and Transunion. 

As long as you’re responsible, it’s very simple to do this. In this post I’m going to tell you what I did, and how you can too!

The Blueprint

I will go into more detail on each step later on in this post, but this is the exact process I followed:

  1. Applied for a ‘credit builder’ credit card
  2. Set up a direct debit to automatically pay off my card each month and never miss a payment
  3. Put everyday, ‘normal’ expenses on my card, such as food shopping
  4. Done!

It’s that simple. After one year of doing this my credit limit had automatically increased to £3,000 and my credit score was considered ‘good’.

I built my credit limit from £200 to £3,000 and my credit score from absolutely nothing to ‘good’ within less than a year. Now, after having credit for less than two years my credit score is ‘excellent’ on all three major credit agencies – Equifax, Experian and Transunion. 

As long as you’re responsible, it’s very simple to do this. In this post I’m going to tell you what I did, and how you can too!

The Blueprint

I will go into more detail on each step later on in this post, but this is the exact process I followed:

  1. Applied for a ‘credit builder’ credit card
  2. Set up a direct debit to automatically pay off my card each month and never miss a payment
  3. Put everyday, ‘normal’ expenses on my card, such as food shopping
  4. Done!

It’s that simple. After one year of doing this my credit limit had automatically increased to £3,000 and my credit score was considered ‘good’.

credit score
credit score

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Credit Builder Credit Card

Firstly, I applied for a ‘credit builder’ card. These cards are for people with no credit or bad credit. Personally, I fell into the former category. I had never had a credit card before, and also had £0 in income as I was a student.

I applied for an Aqua credit card. There are various other similar cards – Vanquis, Ocean, Capital One. These cards are aimed at people who want to build (or rebuild) their credit score. 

If you google ‘credit builder credit cards’ a whole range will come up and you can pick your favourite. Alternatively, you can search ‘credit card eligibility’ and fill in a few questions to see which cards you’re most likely to be accepted for.

Definitely do some research and see which credit builder card is best for you. If you are interested in getting an Aqua credit card like I did, feel free to use this referral link and we’ll both get £25.

If it is your first credit card then your credit limit will be very small – mine was only £200. But the credit limit doesn’t matter. What does is your consistency in paying off the full balance each and every month!

Direct Debit

Secondly, set up a direct debit to ensure you never miss a payment.

This is the most important step. If you miss a payment, or even consistently miss payments, this will wreak havoc on your credit score and plunge you into high-interest debt.

Before you even receive your physical card in the post – set up a direct debit to pay your balance off in full!

I was a bit paranoid about never missing a payment, especially my first one. So, on the date of my first ever credit card payment I set an alarm on my phone just to make sure the money came out of my debit card to pay off my credit card in full.

Sure enough it came out automatically!

‘Normal’ Expenses

You’ve probably heard of credit card horror stories where someone was plunged into thousands of pounds of credit card debt. This can only happen if you’re irresponsible or wasn’t properly educated on credit.

Do not miss a payment. Do not pay the minimum. Do not pay part of the balance off. Pay the full balance off each and every month!

Credit isn’t ‘free money’, although it can seem that way. Don’t live beyond your means for the sake of it and to impress other people, as this is money that you will owe the credit card company.

Hence, the third step is to put ‘normal’, everyday expenses on your card, not extravagant items that you can’t afford. Food shopping, petrol, birthday presents – the idea is anything you would’ve spent anyway, The advantage of putting it on a credit card is:

  1. You will get some rewards – cashback or points
  2. You are increasing your credit score

The beauty of it is, this is money that you would’ve spent anyway. But, instead of using a debit card like you have been, you are now getting rewards and increasing your credit score!

Credit Builder Credit Card

Firstly, I applied for a ‘credit builder’ card. These cards are for people with no credit or bad credit. Personally, I fell into the former category. I had never had a credit card before, and also had £0 in income as I was a student.

I applied for an Aqua credit card. There are various other similar cards – Vanquis, Ocean, Capital One. These cards are aimed at people who want to build (or rebuild) their credit score. 

If you google ‘credit builder credit cards’ a whole range will come up and you can pick your favourite. Alternatively, you can search ‘credit card eligibility’ and fill in a few questions to see which cards you’re most likely to be accepted for.

Definitely do some research and see which credit builder card is best for you. If you are interested in getting an Aqua credit card like I did, feel free to use this referral link and we’ll both get £25.

If it is your first credit card then your credit limit will be very small – mine was only £200. But the credit limit doesn’t matter. What does is your consistency in paying off the full balance each and every month!

Direct Debit

Secondly, set up a direct debit to ensure you never miss a payment.

This is the most important step. If you miss a payment, or even consistently miss payments, this will wreak havoc on your credit score and plunge you into high-interest debt.

Before you even receive your physical card in the post – set up a direct debit to pay your balance off in full!

I was a bit paranoid about never missing a payment, especially my first one. So, on the date of my first ever credit card payment I set an alarm on my phone just to make sure the money came out of my debit card to pay off my credit card in full.

Sure enough it came out automatically!

‘Normal’ Expenses

You’ve probably heard of credit card horror stories where someone was plunged into thousands of pounds of credit card debt. This can only happen if you’re irresponsible or wasn’t properly educated on credit.

Do not miss a payment. Do not pay the minimum. Do not pay part of the balance off. Pay the full balance off each and every month!

Credit isn’t ‘free money’, although it can seem that way. Don’t live beyond your means for the sake of it and to impress other people, as this is money that you will owe the credit card company.

Hence, the third step is to put ‘normal’, everyday expenses on your card, not extravagant items that you can’t afford. Food shopping, petrol, birthday presents – the idea is anything you would’ve spent anyway, The advantage of putting it on a credit card is:

  1. You will get some rewards – cashback or points
  2. You are increasing your credit score

The beauty of it is, this is money that you would’ve spent anyway. But, instead of using a debit card like you have been, you are now getting rewards and increasing your credit score!

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We won’t spam you whatsoever, and will never share your details.

Consistency

It really is as simple as these three steps!

All you need to do now is consistently do this every month of every year. After one year you should have a ‘good’ credit score, most likely above the average in your area and country. 

Not only this but you’ll likely have a credit limit in the thousands of pounds, because credit card companies automatically increase your credit score every six months provided you are responsible with your credit.

Credit Utilisation

Perhaps a bonus point, and a bit more technical, but if possible keep your ‘credit utilisation’ low.

Credit utilisation is how much of your available credit you are using each month.

For example, if you have a £200 credit limit like I first did, and you spend £50 in a month, your credit utilisation is 25%. If possible, you want to keep your credit limit as low as possible. Granted, this does become a lot easier as your credit limit increases.

The most important thing is to pay your card off in full each month. But if you want to accelerate your credit score increase even quicker, then maintain a low utilisation below 30%.

Increase Your Credit Score

Why would you want to increase your credit score?

Personally, I do because I want to benefit from lower interest rates on mortgages in the future. If you’re sensible and responsible, getting a credit card is a no-brainer in my opinion.

We get free points, cashback and rewards – on money we were going to spend anyway! Not only that, but having good credit can go a long way when applying for mortgages or finance. 

But, as I’ve reiterated many times throughout this post, please pay your credit card off in full each and every month.

Consistency

It really is as simple as these three steps!

All you need to do now is consistently do this every month of every year. After one year you should have a ‘good’ credit score, most likely above the average in your area and country. 

Not only this but you’ll likely have a credit limit in the thousands of pounds, because credit card companies automatically increase your credit score every six months provided you are responsible with your credit.

Credit Utilisation

Perhaps a bonus point, and a bit more technical, but if possible keep your ‘credit utilisation’ low.

Credit utilisation is how much of your available credit you are using each month.

For example, if you have a £200 credit limit like I first did, and you spend £50 in a month, your credit utilisation is 25%. If possible, you want to keep your credit limit as low as possible. Granted, this does become a lot easier as your credit limit increases.

The most important thing is to pay your card off in full each month. But if you want to accelerate your credit score increase even quicker, then maintain a low utilisation below 30%.

Increase Your Credit Score

Why would you want to increase your credit score?

Personally, I do because I want to benefit from lower interest rates on mortgages in the future. If you’re sensible and responsible, getting a credit card is a no-brainer in my opinion.

We get free points, cashback and rewards – on money we were going to spend anyway! Not only that, but having good credit can go a long way when applying for mortgages or finance. 

But, as I’ve reiterated many times throughout this post, please pay your credit card off in full each and every month.

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