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Let’s Keep our Identities S.A.F.E.
Security Awareness for Everybody

Here’s how to prevent Identity Theft!

You have entered into the world as a young adult. College is right around the corner, so is independence, and for many, financial responsibility. As you foray into this next stage in your life, you need to remember that building and maintaining a positive and strong credit history is a must. It is a prerequisite for having financial health well beyond your college years.

However, you do not have to become burdened and overwhelmed with how to start and maintain a good credit history. There are practically unlimited resources out there to assist you and aid you in making the best decisions about your credit, and we have devised a little list to help you out and get you started.

7 Ways Students Can Build Good Credit

1. Become an authorized user on your parents’ account

If your parents have a strong credit history then open a joint account or have them add you on as a co-signer. This way, your parents can monitor your spending, and advise you on certain actions that may require credit. Plus, this will help you build your credit on a positive note.

2. Use your credit card for occasional purposes

Only buy what you need with a credit card. Do not use it for “wants” such as sneakers and fast food. Give yourself a maximum spending budget for your credit card each month like, $100, and only use as a last resort.

3. Try to pay off your balance each month

One of the best things you can do to build a strong credit score when first starting out on your own is to pay off you balance in full each month. If you start this habit early, it will serve you well, as you get older and incur more financial responsibility, plus you will have a healthy credit history for that sacrifice. If you can’t pay your bill in full each month, cut back on your spending, and seek assistance until you can turn your situation around for the better.

4. Do not apply for several credit cards at one time

Having one credit card just starting out is enough. Do not see credit cards as free money and apply for many at one time. That will impact your credit report negatively if you do, because creditors will question one, why you are in need of so much credit at once, and two, question your financial means to pay (most young adults have limited income to begin with).

5. Pay all of your bills on time

This can’t be stressed enough! Please be timely with your payments. This will reflect positively on your credit report. Creditors will view you as reliable and as a sound risk for extending credit in the future. If you do not pay on time, it will cause your credit score to decrease and tarnish your reputation with your creditors and potential lenders.

6. Consider getting a cell phone in your name

This is a good idea to try, because getting a phone in your name will help you build credit. Cell phones are a mainstay with most people now, so you might as well get one in your name to give you added responsibility.

7. Only use student loans for education expenses and pay on time

Many college students have abused student loans to buy everything from TV’s to a new fall wardrobe. That is not what student loans are designed to provide, they are to pay for your education solely. Only borrow what you need to cover tuition and class expenses. Give the any balance back to your school. Also, when you do need to start paying your student loans back, pay on time. Minimize your debt as a young adult in this area as much as possible.

Some Additional Advice for Using Credit Wisely Include:

Always watch you’re expenses with credit cards

Do your best to not pay too much in fees (ATM’s, late fees, extra finance charges)

Always take responsibility for your finances

Save for the future to have as a back-up in case you need to make unexpected payments on your credit card or other expenses

And always apply the “needs vs. wants” rule of thumb when using your credit card

Following this check list of advice could assist you in making informed and correct decisions about your credit. However, if you do get overwhelmed with decisions to make and/or have found yourself in a financial bind with your credit cards, please seek additional help. Call your creditors, and ask for assistance with solutions, ask your parents for guidance, or browse the web for additional resources. The key is being mindful and proactive. That is the only way to ensure that your young adult years are spent building a positive credit history for your future.