Keeping tabs on your credit report is extremely important, as is monitoring your credit score. There are many different reasons to check your credit report frequently. Often times there are mistakes on credit reports that can hurt your credit, and need to be fixed immediately. Aside from that, the only way to catch identity theft early is to monitor your credit report for fraudulent activity. There are many reasons why it is a good idea to check your credit score, but here are the top five reasons to check your credit report.

#1: Catch Mistakes

Some estimates say that as many as one in four credit reports have mistakes on them. That's disturbing for a report that has so much effect on your every day life. Mistakes can range from having accounts listed as open that are closed (or vice versa), to having someone else's accounts on your report. You want to make sure your credit report only reflects your credit history.

#2: Detect Fraud and/or Identity Theft

This is a huge one. Monitoring your report for charges you haven't made or accounts you don't have is how you will catch an identity thief red handed. The damage that can be done to you financially, credit-wise, and emotionally from identity theft is incredible, so you will want to uncover it as quickly as possible.

Identity thieves not only charge thousands of dollars to your name, but this can result in collections being sicked on you, and your credit score can take a beating even if you weren't responsible for the fraudulent charges in question.

#3: See Who's Snooping Around

Your credit report keeps track of inquiries about your credit history. This means that whenever people are looking into your credit history, checking up on your credit report can help you see who's looking around. Not only is this good for you to confirm the banks, credit card companies, or land lords who are checking out your credit history, but this also allows you to look and see if there are people checking on your credit score whom you don't know, or who shouldn't be. This is important because it not only tells you about your credit score, but it also tells you who else has that information.

#4: Track Payments

If you're paying bills consistently, that should help your credit score more than anything. Your credit report keeps track of payment history, and so you should be able to check and confirm that all your payments are going through in a timely manner. If anything appears off, this will also allow you to identify and fix the problem immediately.

#5: Knowing Your Credit Position

Want a new car? A new house? Your credit report will let you know what kind of loans and credit you will be able to expect. A great credit score means that you have an excellent chance of getting more credit on the best terms. A lousy credit score is going to make it difficult to get anything.

These are five of the main reasons why you should consistently check your credit score. With 79% of credit reports containing errors, chances are yours does too.