For the students, one of the best phases of growing up is becoming financially independent. But with the present financial condition in the US, learning how to manage your finances is rather a challenging task. Building a good credit standing is a must, especially for all the college students as without it, it won’t be possible to grab the best loans in the market, the best insurance policies, the best apartments and the best jobs. Now were you surprised to read the last point? Well, if you are, you should be aware of the fact that the employers all check your credit score before hiring you for a job. Not the problem is that when you’re a beginner and you don’t have any credit, how would you know how you should boost your credit score and remain on the right track? You may read on the concerns of this article to know the ways in which you can effectively build good credit.
- Get authorized on your parent’s account: The analysts usually advise the parents that unless they’re sure about the fact that their kids are financially responsible individuals, you should give them the opportunity to use your card and make them the authorized user. By being an authorized user on your parent’s account, parents can easily monitor the way in which they’re spending the money. Apart from this, the students can also build good credit through piggybacking. Although being an authorized user has long been a popular option among the students, for some this has presently become the only option. After the Credit CARD Act, students below 21 years of age should have a co-signor for getting a new credit card and so this becomes a necessity.
- Shop around and get the right card for you: Once the student is able to qualify for a regular card through his own income ability, he should be made aware of the fact that not all cards are similar and that they all operate in a different manner. Without adequate research and without shopping around, it is impossible to grab a card with low interest rate, annual fees, transparent billing policies and affordable credit limits. Don’t make the mistake of saying “Yes” to the first card that is offered to you.
- Don’t use your card too often: The advisors always ask you to use the card rarely during making some small purchases and yes small means really small! If you inculcate the habit of using your card too often while making most purchases, you can be sure that you will incur a huge amount of debt. If you think that you won’t be able to repay the balance every month and that you might carry over balance from one month to the other, you should take out a low interest credit card so that the rates don’t multiply and bleed you.
- Repay your balance every month: Do you think that it is only your credit cards that affect your credit? If answered yes, this is the actual fact and hence you should know the importance of repaying your balance every month. If you check the way in which the US credit bureaus shape your credit score, you will come to know that it is when you carry forward your balance to the next month that the hit is the biggest on your credit score. So, you should try your best to repay your balance every month instead of carrying it to the next month and accumulating high interest rates.
Therefore, if you’re a student and you’re spending sleepless nights wondering about the consequences of landing up with the wrong credit card, you should take into account the tips mentioned above. Stay within your means and keep checking your credit so that you may know about any subtle changes and also take help of the professional options if you wish to get out of debt with the help of an expert.
Anjelica Cullin is an aspiring financial writer, Ms. Cullin is passionate about the writing contents with regards to the debt management,credit card consolidation,student loan and so on. Ms. Cullin writes full time for numbers of financial sites and blogs as well.
