Building and maintaining a good credit score is essential for financial stability. Here are some effective strategies to achieve this:

1. Pay your bills on time: Timely payment of bills, including credit card bills, loan EMIs, and utility bills, is crucial for a good credit score. Late payments can negatively impact your credit history.
2. Keep credit utilization low: Aim to keep your credit utilization ratio below 30%. This means using only 30% or less of your available credit limit. High credit utilization can signal financial distress to lenders.
3. Diversify your credit mix: Having a mix of credit types, such as credit cards, installment loans, and mortgages, can demonstrate responsible credit management and positively impact your credit score.
4. Regularly check your credit report: Monitor your credit report for errors or fraudulent activity. Reporting and rectifying inaccuracies can help maintain a healthy credit score.
5. Avoid opening multiple new accounts at once: Opening several new credit accounts within a short period can lower the average age of your credit history and indicate a higher risk to lenders.

By following these strategies, individuals can build and maintain a good credit score, which can lead to better loan terms, lower interest rates, and overall financial well-being.