Building a strong credit score isn’t about having a credit card. It’s about using the credit you do have wisely.
Build Credit Young
Build credit young is immensely important so that you do not have any problems in meeting your demands in later life. Lenders only give credits to people who either have a credit history, or take credit from the market more often. So, if you do not have any credit history or any ongoing credit from the market, it will be very hard for you to actually get a credit from lenders. But there is nothing to be afraid of. You would be surprised to know that about half the American population do not have a credit history and thus are not eligible for taking credits. Here are some of the tips that you must follow to build credit young and be assured financial assistance throughout your life:
• Get a savings account and start investing in some money management and growth schemes such as mutual funds and stock markets. Take a small credit from the market on any of the small domestic appliances and start a credit history. Your existence has to be shown to the lenders form you to build a credit score.
• A credit score is the basis on which a lender lends you money or credit. A credit score is completely marked on the basis of your credibility to pay your credits and the credit ratings your lenders have given you. The credit score is compiled based on the following parameters:
1. Payment History
2. Credit Usage as compared to the Credit limit
3. How long have you been taking and maintaining your credits.
4. How many different types of credits and the means of paying them.
5. How often do you inquire about lending from the market.
• Maintain a savings account and deposit whatever you have saved for a rainy day. In today’s digital world, paying off your credit card bills and other expenditures is very hassle-free.
• If you don’t have a credit card, apply for one. If you apply for a credit card early in your life, you will have a longer credit age and your eligibility for getting credits increases thus build credit young.
• If you are below 18 years of age, there is no reason to worry, as your parents may co-sign your account and thus you can have a savings account as well as a credit card even if you are below 18 years of age. Thanks for watching. Please help us grow.