You’re young and you’ve got your first decent-paying job. You’re ready to take the world by storm! There are so many awesome experiences ahead of you: buying your first really nice car, buying a house, going to… Wait a minute.
It looks like some of the life experiences everyone looks forward to will require good credit – something you don’t have if you’re first starting out. How can you build your credit and keep it stellar as you save up for these huge milestones? Here are a few tips on how to achieve a super-high credit rating.
Utilize Credit Cards
The best way to establish yourself as an excellent credit risk is to show banks what a responsible borrower you can be. Apply for a credit card and start using it to help build a credit history with lenders.
Keep Your Balances Low
Just because you have a credit card, however, does not give you carte blanche to go on a spending spree. Make a few small purchases on it, then pay the balance down immediately. Keeping your credit card balances below 30% will help keep your credit score healthy (and lower than 30% is even better).
Make Payments On Time
This goes without saying, but make every single credit card payment on time without fail. Overall debt and rate of paying on time are two of the biggest factors credit agencies use to create your score, so make sure you’re never late.
Check Your Credit Reports
It’s also a good idea to learn how to check your credit scores in order to understand where you’re at in terms of credit history. This will also give you the ability to check for any discrepancies or errors in your credit report. We suggest doing this at least once a year.
That’s it! By being a responsible spender and credit card customer, you’ll soon be on the path to stellar credit. Good luck!
