If you already have a good or excellent credit score, you may feel that the financial world is your oyster. But you may not want to rest on your laurels (or mix your metaphors), as your credit score isn’t something that remains static – it may increase or decrease based on your financial activity.

Being mindful of your financial habits can make a big difference to how easy or hard it is to keep your credit score at the top end of the band. Here are four of the top ways to maintain or grow a good credit score:

Work towards clearing your debts

It may surprise you to learn that owing money can actually help you get and maintain a good credit score. Showing that you can responsibly manage a mortgage, car loan or credit card demonstrates to lenders that you’re a relatively safe credit risk, and are less likely to default on your repayments if they were to give you a loan.

Of course, lenders will also want to see that you’re making steady progress towards paying your debts. This may simply involve making your repayments on time for a long-term debt such as a mortgage, but making extra repayments towards your shorter-term debts, such as  personal loans or credit cards, can show that you’re actively working to avoid ending up in financial stress.

Apply for credit responsibly

Having a good credit score often means that you’re currently managing your money. But if your personal situation changes, such as if your family grows, or you need to add car repairs or medical bills to your household budget, you may find that you need to apply for some extra credit.

It’s important to consider your options carefully to make sure you’re getting a suitable credit product for your financial situation before you make an application. If your credit file shows that you’ve applied for multiple credit products over a short period of time, lenders may think that you’re struggling with your finances, which can lead to rejected credit applications and lower credit scores.

Similarly, applying for too much credit compared to your household income can make you a risky prospect for a lender, as there’s a higher chance of finding yourself unable to afford the repayments on your various debts. If you want to apply for credit, you may first want to look into paying off your currently outstanding loans or reducing the limit on your credit card.

Pay your bills on time

Are you staying on top of your loan payments? How about your phone, internet and utility bills?

Being a day or two overdue with your bills is unlikely to meaningfully affect your credit score. But once reminder letters start coming, the situation could deteriorate, if you don’t respond quickly.

If your loan or credit card payment is more than 14 days overdue, it will be recorded in your credit report, and remain there for two years. If a number of late payments appear in your credit file, that could affect your credit score.

If you owe more than $150 to a credit provider, telco or utility company, and its more than 60 days overdue, that will be recorded as a default in your credit file, which will remain there for five years. Defaults can serious affect your credit score.       

Staying on top of your bills could also benefit people with bad credit. Comprehensive credit reporting means that a consistent pattern of positive behaviour in your credit history (such as paying bills on time and repaying loans) can start to make up for previous negative behaviour, and gradually improve your credit score over time.

Keep an eye on your credit report

You may be surprised by what information ends up in your credit report. It may not all be correct, either – sometimes banks or finance institutions make mistakes, or you may unknowingly become a victim of fraud or identity theft. Errors in your credit report can affect your credit score, and you may not know why it’s changed until too late.

You can order a free copy of your credit report a limited number of times per year, plus one copy after having a credit application rejected (so you can see the reasoning why). Regularly checking your credit history when it becomes available can give you a better idea of how lenders may see you, and allow you to correct any inaccuracies to prevent them from affecting your credit score too much.