Maintain low debt balances. It will translate into a higher credit score. "Keeping low balances means you're a good manager of credit," says Barry Paperno, customer-service manager for MyFICO.com, a site that lets consumers obtain credit reports and FICO scores from all three big credit bureaus. Lenders frown on a person's having too many cards, but don't cancel all unused credit accounts. "If you close them but maintain the same amount of outstanding debt, your debt-to-credit-limit ratio goes up, and that's not good for your score," he says.
Pay bills on time. Nothing is too small to screw up your credit―not a library fine, not a parking ticket. Pay everything on time, even if it's a bill for $5.
Start simple. Beginner investors should start with index mutual funds, such as one pegged to the Standard & Poor's (S & P) 500 Index. "Index funds are a no-brainer diversification," says Dayana Yochim, personal-finance expert for the Motley Fool (fool.com), an investor-education website. Because the fund is automated (it mechanically follows the performance of the index), "investors aren't saddled with big fees to cover a high-level fund manager's salary." Check out the Vanguard 500 Index mutual fund (vanguard.com).
Reshop your life insurance. "Prices have gone down over the past 10 years and continue to go down, so if you bought a policy several years ago, you might be able to get a better deal now even though you're older," says Kimberly Lankford, finance columnist and author of The Insurance Maze (Kaplan Business, $19, amazon.com). Try insure.com or accuquote.com, which is good for finding insurers who won't balk at preexisting medical conditions, such as high blood pressure, diabetes, and some cancers.