The only way to establish good credit is to start buying on credit, which reveals your ability to pay for things that you buy or use. Here are some helpful tips for anyone just starting with credit:
- Start slowly. Don’t apply for more credit than is needed.
- Don’t charge more than can be paid off at the end of the month.
- Before applying for a credit card, check out the interest rate, associated fees, credit limits, and terms.
- Use your credit card wisely. A credit card opens all kinds of ways to damage your credit score. Never miss a payment. Pay in full if you can.
- Pay “ALL” your bills on time. One of the most important steps in building and maintaining a solid credit history is to pay all of your bills on time each month.
- Get another form of credit (an auto loan, personal loan or some other installment debt). Having different kinds of debt helps your credit score.
- If you want to boost your credit history and credit score, you’ll want to keep your total monthly charges well within your credit limit.
- Regularly read your credit report. One way to build a positive credit history is to make sure you know what information is being reported.