Establishing Credit Score for the First Time

Establishing Credit Score for the First Time

At pretty much every major college and university you will inevitably find some guy sitting at a table with a stack of credit card applications, and hundreds of “free” t-shirts to give away, or a free pizza at Pizza Hut.

Most of the time the guy will get surrounded by a group of new freshmen who want the free t-shirt and put no thought into giving out their credit card information.

We should be so lucky that identity thieves aren’t using these locations to steal banking and other personal information from students.

Often times when people fill out their first credit card application, they are starting to do something that many consider very important in their financial life, and that’s building a reputable credit history.

Establishing a credit history can be very difficult when you are in college because you have to walk a fine line between making use of credit to build your credit score, and not abusing the use of credit that many college students do.

Most college students come out with a student loan of $15,000 and have another $5,000 in credit card and other debt. This isn’t the best way to be very wealthy someday!

While you are in college, there are three things that are pretty reasonable that will help you build your credit score. If you get a credit card, this will help build your credit.

This does not mean you should ever pay a finance charge. Only charge what you can afford and pay it off at the end of the month, if you ever pay a finance charge, you’re worse off than if you had just not gotten the credit card in the first place.

If you have a student loan, this will also help build your credit.

This doesn’t mean you should go out and get a student loan just because the money’s there if you can pay for it, but if you do have one and pay on it consistently, this will help your credit immensely.

Most college students have cell-phones. If you get it under your name rather than your parents, this will be reported to all of the major credit bureaus, so this should help your credit score as well.

Keep your credit score blemish-free. Don’t miss a late payment if you don’t absolutely have to. If it comes between eating and paying your credit card bill, eat.

If you know how to work this probably should not happen. Don’t be irresponsible with your finances and casually miss a payment here and there, which will certainly be very detrimental to your credit score in the future.