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    How To Guard Your Credit Score From Further Damage During Covid-19

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    The COVID-19 pandemic took the world by surprise this year and the economic impact is still being felt.

    Whether you’ve lost your source of income due to the crisis or are simply concerned about your finances going forward, now is the best time to start protecting yourself against the pandemic’s financial impact.

    Having good FICO numbers is essential in a crisis because you never know when you may need to borrow money at short notice.

    Let’s take a look at some of the proactive steps you can take to protect your credit score in these uncertain times.

    Review Your Credit Reports For Errors 

    Consumers borrow money at an increased rate when times are hard.

    Unfortunately, there’s always the possibility that an error may occur - and that’s why it’s essential to check your credit report from the bureaus on a regular basis.

    • Every consumer is entitled to a free annual credit report. As part of the coronavirus relief measures the three credit bureaus have decided to make the reports available on a weekly basis free of charge.
    • Once you receive your report, you’ll want to go through it carefully and keep an eye out for any information that doesn’t look right.
    • If you find mistakes in the document, you can lodge a dispute with the credit bureau that provided the report. 

    Watch Out For Signs Of Fraud

    In the previous section we highlighted the importance of checking your personal information for accuracy.

    One of the reasons for this is that you’ll be able to pick up telltale signs of fraud and hopefully take action before you incur any financial losses.

    • If you notice a name, address, and especially Social Security number that does not belong to you, this could be a strong sign of fraudulent activity.
    • Similarly, if there are any accounts listed on your report that are not yours you’ll need to contact the lender and the credit bureau immediately and file a fraud report. You may also want to freeze your credit profile temporarily.

    Make All Minimum Payments

    If you can possibly make the minimum payment due on your credit cards, you’ll save yourself the significant trouble of having a low credit score.

    • Having your score drop from good to fair – or from fair to bad can have long-term consequences. You may pay higher APR‘s in the future or be rejected for lending products and even some types of accommodation.
    • If you’re unable to make your minimum payments, it’s always best to contact your lender ahead of time and ask for an extension.

    What Your Spending 

    The months and years ahead will be a challenging time for everyone –  and one of the best things you can do is reduce your spending on nonessential items and pay down your debt while boosting your savings.

    • Now is the time to focus on essentials and cut down on expenses and that you can do without. If you’re practicing social distancing you may want to cancel your gym subscription and other monthly expenses services you no longer need. 
    • If you don’t already use a monthly budget to plan your spending, this could be the ideal opportunity to set one up. By listing out every  item or activity you spend money on, you’ll be able to identify which expenses can be cut without compromising your quality of life.
    • The money you save by reducing your spending can be used to pay down your high APR debts and grow your emergency savings fund. You’ll want to have anything from 3 to 12 months expenses saved up to weatherer the uncertain times ahead.

    Seek Help If You Need It

    If you’ve tried your best to budget and pay down your debts but still find yourself in a financially difficult situation, you’re not alone.

    The unprecedented coronavirus crisis has placed many people in situations of hardship and there are several ways of seeking help with your monthly payments should you need it.

    • Reach out to your creditors. Many card issuers are offering customers a range of relief measures as outlined in the CARES Act. These may include payment deferrals and the temporary suspension of the negative credit reporting for a limited time.
    • Consider credit counseling. If your repayments have become unaffordable, you can consult a financial professional who will help you to budget effectively and may be able to negotiate with your creditors to have the interest on your outstanding debts reduced.
    • Don’t forget  about friends and family. Even though the current economy is affecting everyone’s finances, your close friends and relatives may be able to assist you with a small loan, shared accommodation, or other forms of assistance. 


    As the COVID-19 crisis continues to unfold, the economic impact is being felt by everyone. 

    In an uncertain economy the best strategy is to save money and pay down your debt.

    This will help you protect your good credit score, giving you access to emergency borrowing should you need it while laying the foundation for your financial future after the pandemic has passed.