My Credit Score Isn't Perfect. Here's Why I Don't Care

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Perfect credit opens a lot of important financial doors. It gives you access to the best credit cards and most favorable loan terms. Sometimes, it could even help you land a job or an apartment. But having perfect credit is also a little bit overrated.

I recently checked my credit and found that I still hadn't reached that top score. But it didn't discourage me. In fact, I was pretty happy with my result. Here's why.

What is perfect credit?

FICO® Scores -- the most popular credit scores in use today -- rank you on a scale from 300 to 850 based on how you've handled borrowed money in the past. An 850 is considered a perfect score, but that doesn't mean that anything less than that is somehow bad.

Credit scores fall into tiers, like this:

My credit score was in the 800s when I checked, so it still falls within the excellent range. This gives me access to great terms on loans and credit cards when I need them. I'm not shopping for new credit at the moment, though, so my score doesn't affect me much right now.

Even if my score fell into the very good range, I wouldn't be too concerned. I know that I consistently demonstrate good borrowing behavior, like paying my bills in full and on time. I also don't charge a ton of money to my credit cards each month. So as long as I keep up these behaviors, my score should remain high.

How to boost your credit score

If your credit score falls into the poor or fair range, you could benefit from improving it. It takes time, but it can make borrowing money much easier over the long run. Here are some key things to work on:

• Pay bills on time: Paying your bills on time whenever possible is the best thing you can do to improve your credit. Paying 30 or more days late can knock dozens of points off your score.
• Watch your credit utilization ratio: Your credit utilization ratio is the amount of credit you use relative to the amount you have. If your card has a $2,000 balance and a $10,000 limit, your ratio is 20%. Keep it under 30% whenever possible to boost your credit score.
• Pay down debt: If you have a high credit utilization ratio due to credit card debt, make paying this off a high priority. Balance transfer cards can be helpful here. You can also try a debt consolidation loan .
• Limit how often you apply for new credit: Applying for new credit triggers hard inquiries, which can drop your credit score by a few points. It helps to limit your credit applications to once every six months. If you're shopping for a loan, aim to get all your applications submitted within 30 days of each other. This way, they'll be treated as a single hard inquiry on your report.
• Be careful about closing credit cards: Closing credit accounts can lower your average credit age and hurt your score. It's best not to do this unless the card charges an annual fee you're not recouping in rewards each year.

Above all, remember to be patient. Negative marks stay on your credit report for seven years in most cases. Their effects will diminish over time, though. Keep focusing on the above behaviors and you will see your score begin to tick upward little by little.

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