Whether it from unexpected expenses or increased costs, many Americans say they are ending this year in a worse financial situation than last.
Nearly half of Americans believe their financial situation worsened this year, and 24% say their credit scores took a hit in 2025, according to a survey of over 1,000 U.S. adults released Dec. 16 by Intuit Credit Karma, a personal finance platform.
That’s not surprising, says Ted Rossman, a senior industry analyst at Bankrate who focuses on the credit industry.
“The cumulative effects of higher prices and higher interest rates have weighed on people,” and it’s showing up in data as well, Rossman says, citing increased late payment rates on loans, known as delinquencies.
Yet, he says it’s important to have a good credit score, not just because it allows you to access loans and credit cards, but also because landlords, utility companies, cell phone providers and even some employers may review your credit to assess your financial trustworthiness.
If your credit score has taken a hit this year, there isn’t much you can do to erase your history, but Rossman says there are steps you can take to rebuild your credit. Going forward, “try to fill your report with positive info,” he says.
Strategies to increase your credit score
Here are some examples of how you can add positive information to your credit report, according to Rossman:
- Pay off your balance
- Make on-time payments
- Have someone add you as an authorized user on their account
- Sign up for alternative data reporting programs
- Consider credit-building products
The first and best things you can do to increase your credit score are pay off your balance and make on-time payments going forward, Rossman says. Making multiple payments per period to keep your debts low can also boost your score, he adds.
From there, consider asking someone with better credit, such as a family member, to add you as an authorized user on their credit card, he says. As an authorized user, the main account’s positive payment history, age and low utilization can appear on your credit report, helping “piggyback” their good credit to boost your score, Rossman says.
You could also sign up for alternative data reporting programs that report on-time rent, utility or subscription payments to credit bureaus, Rossman says, or look into safe credit-building products, like a secured credit card or credit-builder loan.
Products that build credit can help if used correctly, but they also come with costs, potential negative reporting and limited impact in some credit scoring models. It’s wise to compare costs and understand what is actually reported and to which bureaus, Rossman says.
With any of these steps, it comes down to managing your cash flow and keeping the balance on your credit cards low, a metric called credit utilization, says Dean Tsantes, a certified financial planner and financial advisor at VLP Financial Advisors in Vienna, Virginia.
Like paying off your balances, keeping your credit utilization low is another way to show lenders you can manage credit responsibly, which can help improve your credit score.
“Look at how much cash you have coming in and see where you can utilize some of the cash you have to lower the balance on some of the larger balances you may have,” Tsantes says. “That’s going to lower your utilization and increase your credit.”
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