How to Rebuild Your Credit Score After Past Money Mistakes

If you’ve made past money mistakes that hurt your credit score, take a deep breath. You’re not alone. The fact that you’re here, learning how to rebuild your credit, means you’re already moving in the right direction.

Rebuilding your credit score doesn’t happen overnight, but with a few smart steps and a little consistency, you can make steady progress toward financial confidence and freedom.

Here are five actionable steps to start rebuilding your credit score and get back on track.

1. Start paying off your high-interest debt

Paying off high-interest debt is one of the most effective ways to improve your credit score and reduce financial stress. Once these balances are gone, you’ll free up money for other goals and lower your credit utilization, a major factor in your credit score.

There are two popular payoff methods:

• Avalanche Method (Your Money Style’s preferred approach): Focus on your highest interest rate first to save more in the long run.

• Snowball Method: Start with the smallest balance to build momentum and motivation as you see progress with eliminating open balances.

Once your high-interest debt is under control, set up some guardrails so you don’t end up back in the same cycle. That might look like unsubscribing from tempting store emails or setting up an emergency fund so you can cover surprise expenses without using credit.

Need help tracking your debt? Download our free Crush Your Debt Tracker to start paying it down today.

2. Make every payment on time

Your payment history makes up the largest portion of your credit score. Even one missed payment can cause a drop, so consistency is key.

Set up automatic payments or calendar reminders to stay on top of due dates. If you’re rebuilding from a rough patch, on-time payments are your secret weapon — each one helps rebuild trust with lenders and boosts your score over time.

3. Keep your credit utilization below 30%

Credit utilization is the percentage of your total available credit that you’re using. It’s recommended to stay below 30%, but if you can, aim for 10% or less for even faster results.

For example, if your total credit limit is $5,000, try to keep your balances under $1,500. This shows lenders that you can responsibly manage credit without relying on it to fund your lifestyle.

4. Don’t close your oldest credit card

It might feel satisfying to close a credit card once it’s paid off, but keeping your oldest card open can actually help your credit score. The length of your credit history matters as the longer your accounts are open, the better.

If you’re worried about overspending, put one small recurring expense (like a streaming service) on the card and set it to auto-pay in full each month. Then tuck that card away where you won’t be tempted to use it.

5. Avoid opening new loans or credit cards

Every time you apply for a new credit card or loan, a hard inquiry appears on your report, which can temporarily lower your score. While you’re in credit-rebuilding mode, focus on managing the accounts you already have.

Once your score improves, you can revisit opening new lines of credit, but for now, steady habits matter more than new opportunities.

Final Thoughts

The key to rebuilding your credit score is focus and consistency. Don’t get stuck replaying past money mistakes. Instead, look forward to the future you’re building. With a higher credit score, you’ll not only save thousands in interest but also open the door to more financial flexibility and freedom.

Remember, you don’t have to be perfect to make progress — just committed. 

Want to feel more confident with your money — and actually enjoy the process? Your Money Style Newsletter for weekly tips, motivation, and tools to help you build a financial life that feels aligned, not restricted. ✨