Q What factors affect my credit score? How do I go about improving it? What should someone do to make sure they have a good credit score?

James, Minneapolis

The five main factors that impact your credit score are payment history, amounts owed, length of credit history, types of credit used, and new credit.

A credit score takes time to build, so it also takes time to change. Here are some ways to improve your credit score:

Pay your bills on time. Missed or late payment can significantly lower your credit score

Correct mistakes in your history with the credit bureaus. You can get copies of your credit report information from the three credit bureaus.

Reduce your credit-card balances. Generally, it is good to keep your outstanding card balances less than 25 percent of the credit limit.

Pay down your credit cards as opposed to moving them around.

Good to know

Beginning March 1, Minnesota residents will be entitled to one free credit report each year. For details, go to www.annualcreditreport.com.

The site is sponsored by the three major credit reporting agencies in the United States: Equifax, Experian and TransUnion.

Lucas Bucl (25)

Q Can you give money to a minor who does not earn enough income to pay taxes and remove some of the tax burden from yourself? Is it more effective than placing money in a 529 plan?

Scott C., St. Paul

The UTMA account (for Uniform Gift to Minors Act) provides a good way to use this gifting strategy. However the IRS is also aware of this, so they have placed limits on the amount of unearned income a child under 14 can make. The first $750 is not subject to income tax; the second $750 is taxed at the child's tax rate, and anything over that is taxed at the parent's tax rate.

If you intend to use this strategy often, gift things such as growth stocks that pay little in dividends, and avoid things like high-yield bonds and dividend-paying stocks that produce income.

However, if you are not going to make substantial gifts or regular gifts, you should give stocks that pay a dividend because the first $1,500 will be taxed at zero or 5 percent.

If you intend this money for education purposes, Education IRA's and 529 plans are more advantageous. Education IRA's allow more investing and spending flexibility, but 529 plans allow you to retain control of the account.

Joe Pitzl (23)