College is amazing—lots of new experiences and new life changes. Even though you’ll be very busy, it is important to also understand that now is the best time to start building your credit for all the other financial changes that you’ll experience after college. From buying your first car to buying your first home, you want to build up your credit while you’re in college so you run into fewer difficulties when those important financial milestones come up.
Here are just a few ways to start building your credit now as a college student:
- Put utility bills and student loans in your name.
If you have bills in your name that require regular payments, this will count toward your overall credit score. Paying cable, gas, water, electricity, or cell phone? Put them in your name! If your roommate(s) are also trying to establish good credit for themselves, consider each of you having one bill with your name on it so that you each can start building up your credit now.
If you have student loans, putting them in your name can also help build your credit.
The most important thing here is that you pay your bills ON TIME. By putting these bills or loans in your name, it is important that the bills are paid on time or else your credit score will suffer.
While you’re at it, be sure to pay off the balance on each bill every month. Carrying over a balance might incur some interest charges as well as look bad to creditors.
- Enroll in credit cards in your name:
Apply for your very own credit card in your name! Make sure you’re not applying for several all at once, and DO NOT under any circumstances agree to co-sign with your friends. If you co-sign on a friends’ card and they slip up by not paying a bill on time or they spend a lot more than they can afford, not only will your friends’ score suffer, but YOUR credit will also suffer.
The same goes for all your other bills in terms of how to maintain good credit with your new credit card: pay your bills on time every month, and pay your balance in full. Try to only use the card for emergencies or small purchases only in order to keep your spending in check and to be sure you can actually pay off the balance every month.
There are many ways to start building your credit early. By following these tips, you’ll be well on your way to financial independence during college and beyond!
