Don't ever let your guard down. These days someone could be using your identity and building a credit history - without you even knowing it. The best strategy to maintain your current credit score (which should INCREASE over time) is to mark several reminders on your calendar: doctor's checkup, dental visit and at least once a year - credit report review (use www.annualcreditreport.com) I'm not affiliated with them.

How your FICO Score Changes Over Time

Everyone has a credit score and your credit history determines that score. When you are asking for a loan, the most important piece of information is your credit history. It shows your old credit cards, loans, mortgages and any other type of credit.

Experian, Equifax and TransUnion all collect personal and financial information, from creditors, employers and public records. The information is used to calculate your credit score. Scores range between 300 to 850.  The history and the score are used by potential lenders and can affect your life in many ways - from whether you get a loan to the amount of interest you'll be charged.

Parts of a Credit Report

A credit report is composed of multiple parts. The first section contains personal identification information such as name, addresses and social security number. There will be another section covering court records and public records, including bankruptcies, foreclosures, and tax liens. The final section contains all details concerning your credit accounts and payment history. They record 30, 60 and 90 day lates.

Credit Inquiries 

Finally, every time someone inquires into your credit history, it is chalked up on your credit history for the next year. This is one that people get burned with all the time - every time you apply at stores, online, etc., they keep a record. In addition, of all those who requested your credit history for employment purposes are also recorded - for two years!

How Long Adverse Credit Information Stays in File

Most adverse credit information stays in the report for seven years. The exception is that bankruptcy information remains a part of the report for ten years. There are also some non-credit related items that can stay on forever (think felony criminal convictions).

How Job Applications affect Credit History

If you apply for a position that pays more than $75,000, apply for more that $150,000 of life insurance or apply for a mortgage, it will appear on your credit report. It's important to note, that every item listed has the potential to improve or diminish your fico score. Most importantly, remember that the number of inquires does affect it. More than 3 inquiries in 90 days will affect your score adversely.

Fair Credit Reporting Act

In 2003 Congress passed an amendment to the Fair Credit Reporting Act. The amendment requires each of the three national credit reporting agencies to provide one free copy of an individual’s credit report every 12 months. Consumers should view this as an opportunity to take charge of their financial circumstances - that's why I suggest www.annualcreditreport.com.

Check your Credit Score Often

It’s important to check your credit history often as simple mistakes can easily be made. Errors occasionally show up in the reports. And, perhaps most importantly, Identify theft is on the rise. You need to keep a close eye on your reports so that you'll have a much earlier indication of illegal activity under your name. This helps guard against serious damage being done to your credit.

Online Credit Report Tips and Hints

Be aware that if you order a report from one of the credit reporting companies, a fee will probably be charged. Read the fine print and note that several "free credit report" services are not actually free - they require you to maintain a monthly commitment if you don't close your "free" account in a specified window.

The three credit reporting companies acquire information from a variety of sources, so their reports may not be identical. For that reason, a good idea is to check each company’s report. Order all three reports at once, but note that you will not be able to get another free report from these companies for one year. If you're organized enough, you can spreading out your requests over the year to keep you abreast of any errors or suspicious activity.

Errors on Your Credit Report

If you find an error on your credit report, contact the credit reporting company in writing. ALWAYS include copies of documents that support your position. The company must investigate the questionable item within a reasonable timeframe – usually 30 days.

If your credit report needs improvement, there are perfectly legal ways to improve your credit score over time. There are no quick gimicks or shortcuts to improve your score. Only time and good lending behavior will erase the negatives in the report.

Avoid Credit Repair Companies

Beware of people who offer to improve or fix your credit score for a fee. They are operating a scam. The procedures they use are illegal. Avoid them at all cost. Taking charge of your finances can make a big difference down the road. Fiscal responsibility will eventually reward you with a high credit score. This, in turn, leads to better interest rates and more financial opportunities.

.......more Credit Health Tips!

Pay your bills on time. If you have fallen behind in your payments, get current with them and stay that way.

Keep the balance low on credit cards and other "revolving credit", such as a line of credit based on the equity in the house. It’s better to pay off your debt rather than move it around to a multitude of lower-interest cards. And though it may sound like a good short-term strategy to close out older, unused credit cards, doing so can actually be a detriment to your score. A closed account will continue to appear on you report. On the flip side of the coin, don’t open up a lot of new cards that you don’t need. The increase in the available line of credit can have a negative impact on your score.

It doesn’t take much time, but checking your credit report on a regular basic can help you take care of problems before they affect your buying power or your employment status.