Raise Your Credit Score Today
Credit is one of those tricky things in life. You need credit in order to apply for that loan you need, but you don’t have any credit. When you apply for a credit card, you either get rejected or offered one with a ridiculously high interest rate. You need credit to get credit and just as you need experience to get a job, it can seem extremely unfair at times. However, there are ways to build a nice credit history for yourself while you’re still a college student.
Open Accounts
One of the best ways to get started down the path to good credit (or at least having some credit!) is to open a checking and a savings account. Many banks allow you to open up accounts before you turn 18, so try to do this. It helps you appear stable to future creditors and it’s a good thing to do in general. It sure beats keeping your money in a shoebox, right?
Co-Sign
To really start building your credit, try to have someone with great credit co-sign on a small loan with you. That way, once you start making payments, their good credit will be transferred to you. You basically get to piggyback on their good credit. The thinking is that if someone with great credit is willing to cosign with you, and you pay your bills on time each month, you’re probably very credit worthy. It’s like getting someone to vouch for you. It’s an excellent way to build credit extremely fast.
Student Credit Cards
Once you have a bit of credit under your belt, you can try applying for a student credit card. Now, you should never apply to those credit card offers you get in the mail that are supposedly tailored specifically to college students. These offers only take advantage of you and are not worth the trouble. I mean a 21% interest rate? Really?
Instead, apply for a credit card through your bank or credit union, or have someone cosign on a card for you. If a regular card is still out of the question, try applying for a secured card. It is basically a prepaid card, but it can help you build some credit and eventually get a regular credit card.
Get a Store Card
Another great way to build some credit is to apply for a store credit card. These cards are issued by individuals stores such as department stores and even gas companies. These cards do not build as much credit as a standard card like a Visa or Mastercard, but it is a useful and convenient way to build some quick credit. Just don’t go overboard. You don’t need a card at all of your favorite stores!
Get a Loan
A really great way to build credit while in college is to get a loan. Now, a lot of student loans won’t do you any good credit wise until after you graduate with their grace periods and subsidization. These are great attributes but not when you’re trying to build credit. A small personal loan can help you show your credit worthiness. Anything that you will pay a monthly due for can help your credit score move on up much faster.
Use Your Credit
Last but not least, if you have credit cards, make sure you use them every month. Placing charges on these cards makes it so your credit report is updated monthly. Just try not to charge more than 30% of your credit limit. Keeping your balance below this amount shows creditors that you are responsible with credit and are not very likely to overextend yourself financially.