How to Build Good Credit as a Student


Many young people don’t realize how important their credit is until after they’re out of school. But, upon graduating, they attempt to get a loan for a house or car and find that they can’t, due to their nonexistent credit history.

As such, today we’re looking at some ways to build good credit as a student to help earn financial independence as an adult.

Start Slow

There’s no immediate rush for younger people to take on more than they can handle. Just a few small things here and there can make a big difference in your credit score. Create a budget and keep your income in mind when you make purchases.

If you need to make a big purchase, include that in your budget and save up for it in advance. Make sure you never outspend your income! That’s how you get into too much credit card debt and tank your credit. Remember: live within your means!

Get a Credit Card (With a Low Limit)

Lenders like to see consistency when it comes to applicants. If you get a nice, low-limit card and pay it off every month, you’ll find your credit building rather rapidly. If you find a card with a limit of around $300, you can spend between $50-$100 on it per month and then just pay it off.

The combination of not maxing it out and paying it off on time will do wonders for your credit. If you’re already spending that much money in the month, doing so through a credit card will just boost your credit. That’s win-win!

Set Up Automatic Payments

Late payments will tank your credit harder than you could predict. You want to ensure you pay your bills on time and in full. If you’re not up to date with them, your credit score will be abysmal. Rather than leaving it to your memory, set up automatic payments. It’s more responsible for you to have these come out automatically than to forget them and ruin your credit score.

If you want to build good credit as a student, you’ll have to make sure you’re paying off your credit card, phone, and Netflix subscription. Otherwise, you’re setting yourself up for failure.

The Best Way to Build Good Credit as a Student: Piggyback on Someone Else’s Credit

If you have a trusted relative with good credit, you can slingshot yourself into a better score with them. If they’ll allow you to become an authorized user on their card, your credit will reflect their good spending habits. This only works if the person helping you ensures that they pay off their balance and spends responsibly, of course.

However, if someone you know fits these criteria and trusts you to be an authorized user, you can very quickly have a good score built up. If you don’t know someone who fits the bill for this, don’t stress too much. The other tips here will also work great in helping you build your credit fresh out of school!