1. Closing your account:

Closing a credit card account lowers the amount of credit you have available, obviously. What's not as obvious is the effect this has on your credit rating, which can plummet as much as 100 points in only 2 months as a result of closing a credit account. Why? Because one of the most important factors in calculating credit score is your "percentage of credit available", and decreasing your available credit drops this score. Try to keep as much available credit as possible by using your card at least once a year on a small purchase to keep your account active. And remember, unless your card has an annual fee, do NOT cancel it!

2. Spending to the max

That's right, aside from cancelling your credit cards, using them too much is the easiest way to ruin your credit. Banks like to see credit cards with a high limit, but with little or no balance. These "open" cards indicate a responsible and disciplined consumer. However, if your cards are maxed-out, you're giving banks the impression that you're living beyond your means, and your credit score is going to drop. The easiest fix here is to apply for more credit cards and to request a higher limit on the cards you have. Just make sure you don't use this new credit -- otherwise you're just making your problem worse.

3. Medical Debt Collections

Health insurance is not exactly known for its reliability - it's not uncommon for patients to receive a bill for something they think their health insurance covers, then discover their insurance company won't pay it. By then, the doctor's office has turned the debt over to collection, and your credit score has taken the damage. Protect yourself against this by checking every bill with both your doctor and insurance company to make sure it's paid. That extra bit of time you put in could save your credit score 50 points.

4. Co-signing Gone Wrong

You've probably had family or friends ask you to co-sign a loan for them, and it might sound like a great idea. After all, why not help out someone you care about? But co-signing a loan is dangerous territory, credit-wise. You assume equal responsibility for the debt, and if the other person doesn't pay up, you're expected to. And if your co-signer files for bankruptcy, that'll show up on your credit report, even if you don't file anything yourself. Even if you can prove that the unpaid bills are your co-signer's fault, your credit rating will still suffer. Don't co-sign for anything, no matter how close the friend, unless you can afford to pay it yourself.

5. Paying Bills Late

It's amazing to me, but a lot of people have a hard time remembering to pay their bills. In fact, I've seen credit bureaus of people that SHOULD have perfect credit but don't, simply because they can't remember to pay their bills before they're due. If you're one of these people, you should take immediate action. Visit your current bank, ask them about their "automatic bill paying" program, and enroll ASAP. Once you're enrolled, the bank will send out a check to your creditor automatically each month so you never have to remember. Besides helping your credit, it can save you hundreds of dollars of late fees each year.