Best Ways to Monitor Your Credit

by | Apr 13, 2024 | Billsaver, Building Credit, Understanding Credit Cards

Monitoring your credit is always a good idea. Not only will it help you track your credit worthiness, which is essential if you have a major purchase such as a home on the horizon, but it can also alert you to fraudulent activity. What are the best ways to monitor your credit?

What is a credit score?

Before we delve into the ways to monitor your credit, it is important to have an understanding of what you are tracking. Your credit report, which is the basis of your credit score, is a summary of your borrowing and repayment history. Your credit score (also called a FICO score) is a three-digit number between 300 and 850 that is calculated using a number of factors, including:

  • Payment history: This is the single most important factor in your report. This tells your potential creditors whether you pay your bills on time every month.
  • Debt-to-credit ratio: This is how much you owe compared to how much credit is available to you. You want to keep your credit utilization below 30%.
  • Age of accounts: The longer your accounts have been open, the better creditors are able to gauge your payment potential.
  • New accounts: If you have opened a number of new accounts recently, it could negatively impact your score.
  • Types of credit: Aim for a good mix of auto loans, credit cards, mortgages and student loans.


The first way to monitor your credit is to do it manually. You will check your credit card and bank statements daily or weekly to make sure every transaction is approved. If you notice fraudulent activity, you can immediately notify your financial institution, and they will reverse the charges and issue you a new card. You could even sign up for text alerts from your bank or credit card issuer. You will get an alert from your bank every time a transaction is completed, which is an even faster way to identify fraudulent activity.

You will also want to monitor your credit report. You can request a free report every year from the three major bureaus: Equifax, Experian and TransUnion. You can request a report from one of the bureaus every four months and scan it for unauthorized activity.

Banks/Credit Card Companies

Before spending money on a credit monitoring service, check to see if your credit card company or bank offers such a service for free. Both Capital One and Barclay offer free credit scores to their cardholders, which includes a brief explanation of factors influencing your score. While these services only include a snapshot of your report, they can be useful for tracking your credit worthiness. Also, if you notice any dips in your score, you know it is time to get a copy of your credit report to see what is going on.

It is also worthwhile to look at the benefits of any other services you are using. For example, AAA members are offered free credit monitoring. It is worth taking some time to look at your membership information to see if you are missing out on these perks.

Credit Monitoring Services

There are some free credit monitoring services, including Credit Karma. These services allow you to check your score and report via a mobile app and dispute any errors. Many also offer product recommendations that will show you loans and credit cards that could help you save money on interest. With these free services, though, it is important to still monitor activity on your credit card and bank statements, as fraud alerts will not be as timely.

Many companies, including banks, the three major credit bureaus and identity-theft enterprises, offer credit monitoring services for which you have to pay. They come in a number of different packages, so you will want to check the price. Some services cost as much as $50 per month, which adds up to $600 a year. It is important to weigh the costs of the service versus the odds of suffering credit card fraud, which happens to about 3% of Americans each year. You may be better off combining a free service with your own careful monitoring.

There are also a number of apps on the market, including Clarity Money, Mint and You Need a Budget that will help you track transactions. You can link these apps to all of your financial accounts, which will allow you to track all of your spending in one place. This way, you will not have to log-in to many different accounts to see if there has been any fraudulent activity. Some of these apps, such as Clarity, also give you a snapshot of your credit score for free.

Final Thoughts

No matter the method you choose, it is important to keep a close eye on your credit report. Bad credit can cost you thousands in interest costs on your car or home, and could even prevent you from getting an apartment.