Establishing a Credit History is Easy

You can’t have good credit without a good credit history. But what happens if you have yet to establish a history of using credit? You start managing your finances and before you know it, you’re building a credit history!

The first thing you need is a bank account so you can start doing things like saving money, earning interest, tracking your expenses, and paying bills. Open either a savings or a checking account. Or better yet, open both. Use your account responsibly, including your ATM or Automatic Teller Machine card, and that behavior will soon show up on your credit report.

If you have loans, credit accounts, or utility bills in your name, you must pay all of them on time, every month. If you cannot pay the balance in full, at least make the minimum monthly payment.

Applying for and using a credit card responsibly is another excellent way to build your credit. If past credit card applications were denied, consider getting what’s called a secured credit card. This type of credit card requires you to fund in advance an account that’s tied to the secured card. A secured credit card looks and acts like a regular credit card, but with a big difference. You’ll never be allowed to charge more than the amount of funds you have in attached account.

Also consider credit cards from retail stores and gas companies. They can be easier to get and your payments are reported to the credit agencies. When it comes to establishing your credit remember, every little bit helps!