18 Credit Tips To Know When You Turn 18 (or if you’re just getting started)

We can’t all go back to our college days, but if we could I’m sure there’s a few things we’d do differently. Hopefully, one of those things is to manage your credit better.

If you’re about to turn 18, here’s what to do so that you’ll have good credit as you head into your 20’s!

1. The most important in this list is to get a credit card and use it responsibly! It’s important to start building credit the moment you turn 18. Most banks offer a student version of their card for those with little or no credit.
2. Research what a FICO credit score is and how important it will be in your future as you start to need additional credit for a home or car purchase.
3. Sign up for Credit Karma to stay on top of your credit from the start. It’s a free, no-hassle, no credit card required tool that allows you to get your credit score every 7 days. It’s that simple.
4. Know that actions and decisions you make at a young age will impact you for many years to come. Don’t think that credit health is something you can worry about “when your older”.
5. Don’t put too much on your credit card. A portion of your credit score is credit utilization. Try not to ever let your credit card balance exceed 30% of your credit limit. i.e. if you have a $500 credit limit try to not let your balance exceed $150.
6. Ask your parents to put your cell phone account in your name. Most companies allow a transfer of liability at no cost and will be a great way to build your credit history at a young age.
7. Also ask your parents to be added as an authorized user on their credit cards so that these accounts will show on your credit report also.
8. Never make a late payment. You may not be able to pay your balance in full, but always pay the minimum balance on time no matter what. Even 1 late payment can have a serious negative impact on your credit score.
9. Understand your interest rates. Credit card companies are now required to make the impact of not paying your balance in full very clear on your statement, but don’t treat your credit limit like free money. Depending on the interest rate, you may be seriously adding to your debt if you don’t pay your balance in full.
10. Don’t be fooled by on-campus bank or credit card offers offering those “free gifts” when it sounds too good to be true.
11. Always think twice before giving out your social security number.
12. Call your bank to ask for a credit limit increase every 6 months. It’s common for banks to only offer a conservative credit limit to start, but will increase over time.
13. Once you start to build a relationship with the bank, ask if they can offer you a lower interest rate on your credit card.
14. Limit the number of “hard” credit inquiries on your credit report. A few per year is acceptable, but try not to let the number get above 3-4 each year.
15. Always ask when giving out your social security number for things like apartment applications if it is a “hard” or “soft” pull.
16. Always understand the ins and outs of student loans and know when you have to start repaying. Treat this as a credit card and do not be late on your payments.
17. If you ever get in over your head in debt always call the bank or lender if there’s a payment plan or arrangement you can work together on.
18. Pull your full credit report every year at annualcreditreport.com. This is the only source that allows you to pull your credit report from the three credit reporting companies without it hurting your credit score.

Start young. Trust us…getting a card as soon as you’re able will benefit you greatly down the road when it comes to applying for utilities, car loans, apartments, etc.