Oh, what fun it is to be young and carefree! But wait, hold on, I think life has other plans and you need to be prepared for it from the start. You might have never heard of a Credit Score and you might think it doesn’t apply to you, only adults need to worry about it but you are sadly mistaken. A credit score is the reason why you are able to get loans and credit cards for yourself and so it is crucial to keep a good credit score from the start.
Here are a few ways in which you can start building your credit score from early on:
Apply to become an Authorized User
If you can’t get your own credit card then the next best thing for you will be to become an authorized user in your parents’ credit card. This basically means that you would be issued another credit card from their account which you can utilize for your own purposes. This way you can use their credit score and they can also help you in teaching how to maintain your Credit Card balance.
Get your own Credit Card
One of the best ways to build your credit score would be by getting your own credit card. Once you get old enough or have enough credits, you can apply for a credit card and use it to build your credit score. A credit card utilization can greatly boost your score if used wisely, if not then it could actually cause more harm than good. Always make sure that you pay your credit card bills every month and avoid making late payments or skipping installments altogether, it would really hurt your score.
Pay your bills and dues on time
Now even though you might not have long standing loans or debts, paying off your small bills is important too. You might think that what does it matter if you clear you phone bill or rent on time or not, but your credit report keeps a track of all your bills and collections (Source: CreditRepairXP.com) and if you don’t pay them regularly, then they could come back and haunt you later. So always make it a point to clear all kinds of bills on time.
Don’t get too many credit cards
Do not pile yourself with a bundle of credit cards. Getting one or two is more than enough. If you have too many credit cards, you would need to keep a good credit score on each account which might become a lot of work. You would need to keep a constant check on your credit card usage and if any of your cards crosses the 60% mark, it would be a sad day for your credit score.
Gain more knowledge about Credits
The best way to start building your credit score would be to read about credits and gain more information about it. Learn what could affect your score positively and what you should avoid doing and become better prepared. This will surely help you in keeping your credit score high in the long run.