We live busy lives. Between work, school and our families, anything that saves us time and effort is quite useful. At the same time, it is crucial that we properly manage our finances. Life with poor finances can be incredibly stressful. 

An important part of your financial health is your credit score. How do you maintain the best credit score possible, without spending too much time on it every month? Fortunately, there are several apps that make it quite simple to ensure the best credit score possible – without spending more than a few hours each month.

1. Credit Karma

Credit Karma allows you to monitor your TransUnion & Equifax credit reports each month. When you login, you’ll be presented with your VantageScore credit score. 

Vantage is a credit score created by the three major credit bureaus. Vantage scores are not used by most lenders. Instead, most of them use some version of FICO, a credit scoring company which has existed for decades. For this reason, Vantage isn’t that useful, as a measure of where your credit score actually falls, when applying for a mortgage, auto loan, or some other form of credit.

However, Credit Karma is very useful for other reasons. It provides a simple, easy to understand summary of all of the information on your credit reports. You can see exactly how much money you owe on each of your credit accounts, as well as any late payments, collections, or other negative accounts which might be holding back your credit score. 

With this information in hand, you can put together a roadmap for improving your score. For example, you might pay down credit card balances, which improves your score nearly immediately. Or, you might look into opening a secured credit card, to further build and improve your score.    

Credit Karma also informs you of recent credit inquiries, which might have occurred in your name. This is very important because of concerns about identity theft. The first step to someone opening a credit account in your name, is to apply for credit (which results in a credit inquiry). If you catch an unauthorized credit inquiry early on, you can prevent much of the damage caused by identity theft. 

As useful as Credit Karma is, there are a few important things you should be aware of before using this app. First, Credit Karma is free in large part because it makes money from matching consumers (like yourself) with credit cards, loans, and other products. 

If you apply for one of these accounts, Credit Karma earns a commission. While their suggestions are sometimes quite good, you should be aware that they have their own motives for suggesting certain loan products. This is definitely something to keep in mind before applying for any products listed through Credit Karma.

Also, you should avoid disputing negative credit items through Credit Karma. Credit Karma’s online dispute process is designed mainly for the convenience of the credit bureaus. You limit some of your legal rights, and reduce the burdens credit bureaus have to meet. For example, you’re required to select a reason for your dispute (rather than being allowed to explain things in your own words).

2. Freecreditscore.com

Freecreditscore.com provides you with a free Experian credit report, along with your FICO 8 credit score. Remember, Credit Karma only offers Equifax and TransUnion credit reports.

Experian is the largest of the three major credit bureaus. It is quite possible that certain accounts only appear on your Experian credit reports. This is especially true with some debt collectors, who only report accounts to Experian.

You’ll want to use freecreditscore.com in a similar way as Credit Karma. That is, you should review your balances on each account, and keep an eye out for any surprise credit inquiries or collections account.

One major advantage of freecreditscore.com (as compared to Credit Karma, is that it offers a FICO 8 score. The vast majority of lenders use some version of FICO. While the actual version of FICO they use might vary somewhat from FICO 8, it’s likely to be relatively representative.

It is possible to purchase your FICO scores (all versions) from myfico.com. However, keep in mind that for the most part, this isn’t really neccessary. Having access to your FICO 8 score, and a good idea of what appears on your credit reports, is usually more than enough.

3. Mint

A big part of effectively managing your credit score, is understanding where your money is going, so that you can pay your bills on time (and not accumulate too much debt). What if you were able to monitor your spending, savings, credit cards and bills in one place, and make sure that everything was on track – completely free?

Fortunately, this isn’t a hypothetical question. Mint.com (simply known as Mint), allows you to link all of your checking and savings accounts, credit cards, loans, and other bills, in one centralized portal. You can keep an eye on how much you’re spending, as well as what you’re earning through your job or business, as well as through investments. You can monitor when each of your credit accounts is due, and make sure payments went through on time.

Mint doesn’t just help you track your spending. It also gives you actionable advice around how to manage your budget, invest money, and build a stronger financial future. In short, Mint makes it possible to better track and measure your financial health, and thus improve upon it.

4. Annual Credit Report 

Under federal law, you’re entitled to a free copy of your official credit reports, once every 12 months. How do you obtain these reports? By visiting the Annual Credit Report website, or using the mail in form. Keep in mind that the Annual Credit Report website can be a bit tricky to use, so in some cases, using the mail in form makes more sense.

When you recieve your reports, what should you look for? First, it’s important to understand how to read your reports. Unlike Credit Karma or freecreditscore.com, Annual Credit Report doesn’t offer the easiest to read format, so you might want to refer to this guide from Nerdwallet.

First, you should review all of the names, addresses and other personal information listed on your reports. If any of the names or addresses appear incorrect, you should dispute these  addresses with the credit bureaus. Incorrect names or addresses can result in having negative credit accounts, which don’t belong to you, appearing on your credit reports. In fact, it’s best to remove all old addresses from your credit reports.

Next, you should review each of your credit accounts. Make sure that there are no unusual late payments or other negative information appearing on any of your credit accounts. If you were signed up for Credit Karma and freecreditscore.com, you should have caught that before, but you should still be checking Annual Credit Report, just in case.

You should also look for unexpected collections accounts. It is all too common for a random bill, say a medical bill which insurance did not cover, to pop up on your credit reports. Given that a single collection account can reduce your score by 100 points or more, it is crucial that you keep an eye out for such accounts – and address them as soon as they appear.

Lastly, you’ll want to keep an eye out for unexpected credit inquiries. Remember, these inquiries can be one of the first signs of identity theft. Catching unauthorized inquiries early allows you to freeze your credit reports, and take other steps to prevent the damage caused by identity theft.

The Final Word

Managing your credit can often be a rather intimidating task. Fortunately, tools like Credit Karma, freecreditscore.com, Mint and Annual Credit Report make it much easier to stay on top of your credit, and your finances more generally. By spending less than 1 hour each month, you can ensure strong credit, which saves you money, allows you to live better, and avoid financial challenges in the future.