College can be a stressful time full of due dates, group projects, and exams. But one thing you shouldn't need to worry about is your credit score. It's essential to start taking steps toward building up your credit before you need it.
While we recommend doing all of the research you can, here are some helpful tips to get you started building your credit while still in college:
1. Become an Authorized User on a Trusted Family Member's Card
As long as your family member has good credit, becoming an authorized user on their card is a great option. This will allow their spending to look as if it's your own. They'll also be able to monitor your expenses and make sure you're on the right track without much risk.
2. Research Your Credit Card Options
There are tons of resources available for finding the best credit card to meet your needs. Try looking for one without an annual fee and a high cash back percentage. But know that when you take out a line of credit in your name, only you are responsible for the debt you accrue. If you can't qualify for a card on your own, a secured card is also an option.
3. Pay Off Your Balance on Time Each Month
Minimum payments may seem great, but the interest you're paying definitely isn't. Make sure you're paying off your balance on time and in full each month. As a student, it can be easy to lose track of deadlines, so consider setting up automated payments.
4. Only Use Your Card for Purchases You Can Afford
Don't consider this card "free money," and be particular with your purchases. It's best to purchase small items that can be paid off each month. But be careful - payment history impacts your credit score, and you won't be building that if your card is sitting in your desk drawer.
College is a great time to start building a strong credit history. Be responsible, do your research, and ask a lot of questions along the way. And when you're ready to purchase a car or your first home, your future self will thank you.
And as always, please reach out to us with any questions you may have. We are happy to coach you and provide additional resources in regards to building your credit.