If you’ve landed on this website and you’re curious on how you start to establish credit, you’re already on the right path. A question a lot of us younger folks wonder is how exactly you “establish credit” The credit game can seem very complicated and complex but when you step back and look at the big picture, it’s not that complicated at all, in fact, it’s quite simple if you play the game properly.
If you’re currently a college student and you have no credit history at all, you’re already a great candidate to get a credit card. Credit card companies love people who don’t have any credit and if you’re going to college, this is even better. The reason they think this is because they view a college student as a more responsible adult compared to a young adult fresh out of high school with no motivation.
Let’s get to the point – How do I establish credit?
As mentioned in the last paragraph, if you’re going to college, you’re in the right boat. The best way for someone like you to establish credit is by applying for a student credit card. A student credit card is simply a credit designed for college students only. Your chances of getting approved for a credit card for students is a lot greater than one that’s a regular credit card designed for people with established credit. If you have no credit whatsoever and you apply for a student credit card, the chances are you’ll most likely get accepted.
What if I’m not a student?
If you’re not a college student, the game might be a little harder for you to get your first credit card to start establishing your credit. The first thing you’ll want to do is apply for a checking and savings account at your local bank. Unless you’re a shady individual, the chances are you’ll get accepted. Once you apply for a savings and checking account, you’ll want to go on a loan / credit card hunt to start building this credit of yours up.
Experts say that the best credit card to apply for in order to establish credit is a department store credit card. These cards generally have low credit limits and most of them do work with financial institutions. So, if you make your payments on time, you won’t have to worry about getting rejected for a card in the near future.
If a local department store credit card doesn’t appeal to you, you can always try a regular credit card that might fit your needs. Remember, that you’ll probably get rejected five to ten times before hitting the jackpot. If you’re not having any luck, try calling up customer service to see what card they would recommend. Citi Bank and Capital One usually are the best when it comes to first time appliers.
Credit cards are the best way to start building your credit. Remember, you’re going to want to pay your bills off on time all the time. One missed payment is going to hurt your score so make sure you avoid it at all measures. If you spend responsibly and pay off your bills all the time, you’ll be on the road to success.