How often should you check your credit report? Should you check with just one credit reporting bureau or all three?

You can, today, either order one free annual credit report from all three credit-reporting bureaus by taking advantage of annualcreditreport.com, or you can order one free one, every few months, separately from each of the three major credit bureaus. Either way, it's worth doing, and that activity will serve you well. Just remember that the credit report you get from Experian is going to be a little different than the one you get from Equifax or TransUnion.

It's important to check your credit report, but it's especially important to have that information on hand before you make a major purchase -- before you go about planning on buying a new car or a new house, for example. It's a good idea to have that paperwork so that you can make sure there's nothing in there that could adversely affect you. You want to make sure that there are no mistakes in your file -- there often are errors in there -- and you want to have the time to dispute and resolve them before you head out and shop for that new car and a loan.

What is the time limit with respect to contesting inaccurate information on a credit report? Where must you report such corrections?

There is no time limit with respect to correcting mistakes. In fact, the credit bureaus have a time limit within which they must respond to you, but you don't have a time limit.

With respect to errors, generally you report the error to the credit reporting bureau that has the erroneous information on file. If the same error appears on all three credit reports, then it's best to contact all three bureaus.

How do you effectively contest a credit card purchase or transaction to ensure that nonpayment for any "bogus transaction" does not somehow wind up on your credit record?

You dispute it as soon as you are aware of it, because in this case there is a time limit of 60 days. And you must make sure that you do this in writing, because you want to have some proof that you actually did dispute this within the time frame. Ideally, disputes should be done using certified mail with a return-receipt and you should keep a copy of the letter you send the lender or credit card issuer for your own records. Make sure, too, that you send your letter to the "billing dispute" address, not the address where you normally send your payments.