Credit setbacks happen — but they don’t define you. With patience, the right tools, and supportive guidance, you can rebuild your credit and regain confidence in your financial future. Whether you’ve missed a payment, carried high balances, or faced other financial challenges, this guide offers empathetic insight and actionable steps to help you bounce back.

Build a roadmap

Start by reviewing your full credit report. Understanding the root causes of a setback can give you a clear plan for repair. Common issues include missed or late payments, high credit utilization, accounts in collections, or errors in reporting. Your payment history makes up about 35% of your FICO® Score, so even one late payment can hurt your credit. A single 30-day late payment can lower your score by as much as 100 points. More severe delinquencies can hit even harder.

You’re entitled to a free credit report from each of the three major credit bureaus — Equifax, Experian, and TransUnion — every 12 months through AnnualCreditReport.com. Pull reports from all three to ensure you’re getting the complete picture. In addition to reviewing payment history, look for other key details: outdated negative accounts that should have fallen off, unfamiliar accounts that may indicate identity theft, duplicate entries, or incorrectly reported credit limits that can skew your utilization rate.

If you spot incorrect or suspicious information, file a dispute promptly with both the credit bureau and the creditor that reported it.

Understand your realistic timeline to recovery

Credit recovery is rarely instant, but it is absolutely possible. The time it takes depends on the nature of the setback and how consistently you apply healthy financial habits going forward. A single late payment remains on your credit report for seven years, but its impact fades much sooner if you make every payment on time after the slip up.

More serious issues, such as multiple missed payments, accounts in collections, or debt settlements, may take longer to show improvement. The good news? Credit scoring models reward forward progress. The sooner you begin taking positive steps, the sooner you’ll see change.

Take small, consistent steps

Making small but steady improvements in your financial habits can have a big impact over time. Start with these strategies:

• Make on-time payments every month. Even if you can only pay the minimum, paying by the due date matters most for your score. Setting up autopay or calendar reminders can help you prevent late payments.
  
  
• Tackle high-interest balances first. Credit utilization — how much of your available credit you’re using — is the second biggest factor in your score. Aim to keep balances under 30% of your limit, according to Experian.
  
  
• Avoid taking on unnecessary new debt. Opening too many new accounts at once can trigger hard inquiries, impacting your score.

Consistency is key. Small changes compounded over time build a strong credit profile.

Build new habits

Once you’ve stabilized your finances, focus on creating systems that make good credit behavior second nature. A budget can help you prioritize bills and track progress. Setting up automatic payments for recurring expenses ensures you never miss a due date, while keeping a small cash cushion in your checking account can help you avoid overdrafts.

If you need to establish or rebuild credit, consider a secured credit card. This type of card requires a refundable deposit which reduces the lender’s risk. Use it for small, regular purchases and pay it off in full each month. Over time, this activity gets reported to the credit bureaus and can help improve your score.

Track your progress and stay motivated

Monitoring your score is one of the best ways to stay encouraged while rebuilding credit. Even small wins — like a modest point increase or a recent bill paid on time — can remind you that your efforts are paying off.

Everyone hits financial bumps in the road. What matters most is how you move forward.

Staying on top of your credit score is easier than ever with MyCreditScore & More. Available free in Online and Mobile Banking, it allows you to check your score anytime without affecting it. This “soft inquiry” tool also shows the factors influencing your score, sends alerts about changes, and lets you see how certain actions might improve your score.