Starting on the Right Track to Build Good Credit
photo credit: Logan Antill
Obviously, the best place to start at building yourself a good credit rating is right at the beginning, and not waiting until debts start to mount up and you have to fix it. Here are some tips that young people should follow to ensure from the very start that they do the best to have a good credit rating:
- Open checking or savings accounts and maintain them well - no bounced checks - as these will prove you can handle money reliably.
- Apply for a credit card - but always pay the balance in full every month. If for some reason things get out of hand, always pay the minimum amount and wherever possible, pay more.
- Don’t apply for multiple credit cards or loan facilities at the same time. Wait at least six months in between applications.
- If you have a parent or sibling with a good credit rating, you can ask them to be added as a secondary card holder on their credit card account, and their good credit will reflect on you.
- Get your credit report annually to check for any errors on it, and always fix them immediately.
- Don’t close your credit card accounts even if you are not using them anymore - debt-free credit cards that you’ve had for a longer period show financial stability.
- Make all your payments for credit cards and loans on time. Late payments affect your rating badly.
- Increase your allowable credit but don’t use it - having a bigger credit limit (but lower debt) means you have a good debt-to-credit ratio which has a good affect on your credit rating.
This entry was posted on Monday, September 22nd, 2008 at 5:32 am and is filed under Credit & Debit Cards. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.
