Assume you bought a television for $500 on your card and then took out $50 in cash. Even though you pay $50 back next day, you still lose your interest-free period because credit provider deems you pay cash back last.

As a result you will still owe $50, but you will now only owe $450 on $500 worth of purchases.

You'll continue to forfeit your interest-free period up until you have completely paid back full $550. Any future purchases will still be ahead of $50 in payback line.

The lesson is simple: Avoid using your credit card to withdraw cash wherever possible. You'll save money as a result!

LENGTH OF ESTABLISHED CREDIT (15 percent)

The longer you’ve had credit accounts higher you will score in this area. The age of your oldest account and average age of all your accounts are used in determining your score. Old accounts that have gone unused are also considered. The key to a higher score: Establish good credit and keep accounts active.

APPLICATIONS FOR NEW CREDIT (10 percent)

Opening multiple credit accounts within a short period of time represents a greater risk of becoming overextended. Each time you apply for credit an inquiry is made into your credit history and these inquiries show up in your credit report. A high number of credit inquiries will lower your score.

Some inquiries are not considered in your score. These include: requests by you for your credit report, inquiries from companies for pre-approved offers or companies that already do business with you, along with inquiries from potential employers. Some requests for credit are treated as a single inquiry especially when you are shopping for best loan rate. The key to a higher score: Only apply for and open new credit accounts when you need them.

YOUR CREDIT MIX (10 percent)

This category examines types of credit accounts you have and how many of each. Can a person have too many accounts? Yes and no. It really depends on whether you have an established credit history or no credit history at all. The key to a higher score: Open credit accounts only if you intend to use them.

Don’t despair if you have a low score or are just beginning to establish credit. Your credit score will change for better or worse depending on how well you understand and use these five keys to your advantage in planning your financial future.