800+ Credit Score

My credit score finally crossed most coveted number: 800!
It is said wisely, Ask diet advice to a slim person, not an obese. As a excellent credit score holder myself, I can give a practical and proven way to improve your credit score.

1. I have 4 credit cards, all have more than 10 thousand dollars of credit limits.

•  When I was a student I applied for a first student credit card with a credit limit of $800. After 6 months I applied for another student card with limit of $500, and another one after a year with a credit limit of $300 and 3 more cards after that with similar credit limits.
• I used cards extensively during that time, but paid at least minimum payments. 
• Due to lot of expenses during college years, they were maxed out by the time I graduated.    
• I paid off the balances within first 2 months after I started my professional career. 
• After started working, I have never left any balances on my cards for more than 30 days on any of my cards. Most of the times I clear all my balances twice a month.
• After every 6-8 months I called credit card companies to increase my credit limits.
• I converted all the student cards into rewards cards one by one.
• I canceled the cards which were not increasing my credit limits. at the same time. I canceled 3 cards during that time and got 2 other rewards cards.
• As I was increasing my credit limits on other cards, canceling my old student cards with very little credit limits, didn't hurt my credit score as overall my limit was higher so my balance-to-credit-limit ratio was getting smaller and smaller.
• Finally I ended up with all four major credit cards, Visa, Master, Amex and Discover.
• I stopped applying for any more cards. I just changed the rewards programs and made sure they didn't close account and reopen new one for different rewards, but just changed the rewards without modifying account number etc. 
• That helped me to keep the same card since my college days. I still use that same card very frequently, which has a credit limit more than 20 thousand dollars.
• In any given month, I do not use more than 2 cards. One cash rebate card Blue from American Express and Discover. American Express Blue has the best cash back rate, once you cross $6,500 in purchases in one calender year the Accelerated Cash Back kicks in.
• I do almost all my purchases with credit cards and pay them every month religiously and bring balance to zero by the start of another month. That way, I don't have to worry about the "Due Date".

2. I have a 30 years mortgage. I have never been late on my payment.

• In fact I made one extra payment in the very beginning and since then I am making mortgage payment as if it is for the current month, even though my due date is after 1 month. eg.  I made a payment on May 1st not for Month of May but for Month of June. So on May 5th (after lender receives my payment) my next due date for payment will be July 1st. 
• This is like a safety net for myself against any unfortunate events that may put me a month behind on a mortgage.
• I always add extra 10-20% of principal payment with my mortgage which brings the principal down and ultimately will help me pay it off faster and get out of the mortgage debt. 

3. I never took out an Auto Loan.

• From "Millionaire Next Door" I learned very important thing, never buy a New car.
• You can use the same money which you spend in buying a new car in your mortgage.
• I always buy used car. Let somebody else pay for the depreciation.
• My first car was worth only couple of thousand dollars worth, which I used for 3-4 years to get my money out of it.
• My last car I bought from a guy who was about to lose it to the bank because he could not afford top-of-the-line luxury car, but bought it just for a prestige.
• I bought it for 3 thousand dollars less than the private party price as he was going to lose it anyway. So i just paid off his loan with a real cash.
• We are going through a recession and many people are going through financial problems who did not take wise financial decisions. Use their mistakes for your benefit. I hunted for a car for almost 6-8 months before I bought it.
• When I know i will need a new car in near future, I start making $400-500 payments to myself and put it in savings or invest it. So when I am ready (after 2-3 years) I have enough cash to buy used good quality car. 
• One important rule of thumb, if you are paying more than $1,500/year on car, you are paying too much. eg. if you buy a car worth 10,000. by this rule the car should be used for at least 7 years (untill wheels fall off), or 4 years and $3-4,000 in resell value.

4. I do not have any student loan.

• I have been always straight As student, it paid off by me getting scholarships and Financial aids. Financial advantages of being a hard working student.
• So after my graduate degree, I ended up with credit card debt less than 2 months of my entry level job salary.