Smart tips for rebuilding your poor financial health

financialexpress.com:

Your financial health mirrors your skills to manage your wealth and debt effectively. It is often seen as a reflection of your stability and your credibility to be eligible for financial products. In the journey towards financial stability, one of the critical aspects often overlooked is credit health.

In India, having poor credit health can significantly hinder one’s ability to access loans, credit cards, or even basic financial services. But what exactly constitutes poor credit health, how does it get impacted, and why is it crucial to rebuild it if it’s poor?

This article will help you decode what exactly is poor financial health and how to work around it to put it on the right track. It is important to understand that poor financial health is not an end to the world. You have many opportunities to improve your overall financial conditions provided you follow a disciplined approach and start working towards it from day one.

Poor credit health refers to a situation where an individual’s creditworthiness is compromised due to various factors. This often manifests in a low credit score, making it challenging to obtain credit from financial institutions. Credit scores in India are determined by credit bureaus such as CIBIL, Experian, Equifax, and CRIF, based on factors like repayment history, credit utilisation, length of credit history, types of credit accounts, and recent inquiries.

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Several factors can impact one’s credit health negatively.

Adhil Shetty, CEO, Bankbaaar.com, says, “Avoid missed payments, as consistently failing to pay bills on time can greatly harm your credit score. Equally important is to refrain from utilizing a high