Credit is one of life’s necessary evils. You need a decent credit score to buy just about any big ticket item – car, boat, house — or even to get a job or car insurance. But bad credit can keep you from obtaining many of your aspirations.

What’s worse, the Federal Trade Commission (FTC) estimates that 25 percent of credit reports contain errors that affect the consumer’s score.

Here are four steps you need to take to make sure your credit is at its best, hopefully before you actually need it.

Step 1. Pull your own credit report.

Everyone gets one free annual credit report through the website AnnualCreditReport.com, which is provided by the three major credit bureaus. A recent law mandated the bureaus to provide a credit report to consumers, free of charge.

The site does not show a credit score for free, but there is an option to pay for a report with a score.

As an alternative to AnnualCreditReport.com, you can pull your credit report and score through this credit resource. You’ll receive everything you need to review your credit history.

No matter which service you choose, your credit report will show you late payments and other derogatory items. The report also shows all the accounts showing up under your name. Often, these accounts are reported erroneously – they are someone else’s.

If the account shows late payments or a default, your score goes down, not the score of the real owner.

Make sure there are no errors on your report.

Click here to pull your credit report and score using this credit service (which by the way is not affiliated with AnnualCreditReport.com.)

Step 2. Analyze the report.

Look through each and every account. Make sure there are no 30, 60, or 90 day late payments showing. All these hurt your score.

Make sure you recognize each account. If there’s an unfamiliar account showing up, it could be someone else’s.

Step 3. Gather documentation.

If erroneous items show up, you should send a formal letter to the creditor along with supporting documentation.

The documentation must be very specific and prove beyond the shadow of a doubt that you paid the bill on time, was paid and closed, or is not your account at all.

The creditor has 30 days to respond to your request. If they don’t respond in this timeframe, they must remove the derogatory item from the records.

If the creditor accepts the documentation or fails to respond, they will report the error to the three credit bureaus. The bureaus will then remove the item from your report.

If the credit does not accept, they will not notify the bureaus and the item won’t be removed. At that point, ask the creditor what documentation they need. Keep trying to get documentation based on the creditor’s requirements.

Step 4. Make all payments on time.

Now that you have examined and fixed errors, it’s your job to keep your credit healthy. Even if you’ve made credit mistakes in the past, you can recover.

Dings on a credit report affect your score less as time goes by. As you build a positive credit history starting today, your score will improve little by little. If you pay everything on time for 12-24 months, your credit score can improve by 100 points or more, even after a bankruptcy, short sale, charge off, or repeated late payments.

Step 5. For serious cases, seek out professional help.

Credit solutions professionals have all the right phone numbers to all the creditors. They know how the creditors work.

Professional credit solutions agencies can contact and negotiate with the creditor to get erroneous items cleared quickly, or work out payment terms for late accounts.

We live in a do-it-yourself society, but when credit issues are very deep and complicated, it’s often time to call in the pros. For more information on how to get professional help, see our video with credit solutions expert Blair Warner.

Credit is a complicated, controversial, and frustrating issue. But don’t be afraid of it. The only way to achieve many of your goals in life like buying a home or landing that great job is to have a good credit score and profile.