If you’re like most Americans, the last several years have not been kind to your coffers. Wages have stagnated, unemployment has remained stubbornly high, and economic growth has been anemic. Many individuals and families have seen their once-immaculate credit profiles severely tarnished, while those who once had average to good credit now find credit far more expensive than before—if it’s even accessible at all. All too frequently, however, this damage is less the result of changing economic circumstances as it is the result of individuals refusing to adapt to these changes. That is, your credit profile is almost always within your control.

No matter what your current credit profile looks like, it can always be improved. Whether you’ve never had spectacular credit or it has just been damaged over the last few years, repairing your credit profile is not difficult. It merely seems difficult because most people don’t understand how the underlying models that build an individual’s profile work. So individuals will fixate on minute items that have only a marginal effect on their profile while ignoring more substantial items.

As an example, people will obsess over keeping the number of inquiries on their credit report low. This means they’ll visit only one or two car dealerships for fear that excess inquiries will impact their score. In fact, inquiries, and more importantly the type of inquiries, make up only 10% of one’s credit profile. And most scoring models will treat up to four inquiries made over a 72-hour period as a single inquiry.

As another example, people will close credit accounts, such as credit cards, once the balance is paid since they believe more open credit lines means a lower credit score. In fact, the scoring models prefer seeing more available credit than less. If a borrower has several credit lines open with small balances, it means they’re responsible enough not to abuse their access to credit. The quality of one’s credit lines accounts for 10% of their credit profile. Further, a full 15% of their credit profile is informed by the length of time the borrower’s accounts have been open. Closing a ten-year-old, zero-balance account can have a substantial effect on your credit score versus leaving it open.

People often ask what an ideal credit profile looks like. My advice is to have five open, active credit lines composed of 1 mortgage, 1 auto loan, and 3 other trade lines—personal loan, credit card, store card, etc. Most models prefer to see a 20-25% balance on the last three accounts, although lower balances are preferable to higher balances. And, of course, you must be sure to pay all your bills on time. Any delinquencies showing on a credit report will raise questions with creditors.

Over the last few years, there has been a small but growing movement arguing that individuals should disregard their credit profile. Their argument—one to which I’m mostly sympathetic, by the way—is that individuals should live without depending on credit. That is, everything from household staples to cars should be paid in cash. Although I largely agree, I believe savvy individuals can use credit as a tool to improve their financial situation, if used responsibly. Instead of saving for an automobile and paying in cash, they can direct these savings toward investment vehicles whose returns exceed the interest rate on the loan. And as nice as it would be to pay for a house in cash, this is far beyond the realm of possibility for most people.

While credit is not a necessity, it is a high-value tool that most people can and should use. Having a poor credit profile, however, makes the use of these tools very expensive. Many creditors will not even lend to borrowers below a certain FICO score, while virtually all creditors penalize borrowers will low scores. As an example, a low credit score can mean a manual underwrite on a mortgage. This not only costs about a half-point up front on the loan,