Tuesday, October 15, 2024
HomeFINANCEBuilding Credit: How to Guide for Young Adults

Building Credit: How to Guide for Young Adults

According to one study, about 30% of Americans have bad credit scores.

If you’re one of those Americans who has a bad credit score or doesn’t have any credit alone, you’re definitely not alone. 

Thankfully, we have some tips for building credit, so make sure you keep reading!

Become an Authorized User on a Credit Card

If you’re not old enough to open your own credit card account, you can also ask a significant other or a family member to add you as an authorized user on a credit card.

This means that as long as that member is financially responsible, you’ll be able to start building a long history of credit. However, you don’t even have to have a credit card or spend the money; you get free bonus points just for being on their account. 

You should make sure that the family member’s credit card issuer reports to the credit bureaus. If it isn’t, then this won’t count for anything and you’ll still have to start over. 

Open a Credit Card Account

If you are old enough to open your own credit card account, you should do some research first to figure out which card would be best for you. 

You should still apply even if you have no credit history. You might want to find beginner cards that are easier to get approved for. You’ll how a low credit limit to start out with, but if you’re responsible with it, then this is a great way to start building up your credit. 

If you’re interested in opening your first credit card, you can continue reading about it here. 

Don’t Miss a Payment

When you do open your first credit card, you should make sure that you make every payment on time. Doing this simple thing over time can really help to boost your credit score.

Many credit card companies will send you a minimum that you have to pay along with your statement balance. Even though the minimum payment might be tempting, you should make sure that you still pay the statement balance. 

If you have extra money, you should even try and pay off the entire card each bill. Keeping your used credit limit low will also help to boost your score. 

Check Your Credit Report and Credit Score

A credit report will give you your score and can help you predict what your scores will be in the future. 

One popular site to run a credit report is TransUnion. This will also warn you if someone else has an account open under your name, which could ruin your score. 

Learn More About Building Credit

These are only a few things to know about building credit, but there are many more things that you should keep in mind.

We know that it can be difficult to build credit, but we’re here to help you out.

If you enjoyed this article, make sure that you explore our website to find more articles just like this one. 

RELATED ARTICLES

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Most Popular