My freshman year of college, I decided it was time to apply for my first credit card. The balance was around $500 and I felt like I could buy the world.
Little did I know, my spending would quickly catch up with me and entire paychecks would be spent as soon as I received them. Yes, walking to class every day with a venti latte in hand was great, but I hit my limit fast. So I applied for a new card. Word of advice: don’t be like me.
Today I have built my credit score back up through budgeting to pay off my cards. Becoming a college student often means becoming financially independent for the first time in your life; it really is easy to lose control. While the future might feel far off, building good credit now is the key to someday purchasing that huge apartment and new car you’ve always pictured yourself with.
Here are a few tips to achieve good credit that will pay off in the long run.
- Open a Credit Card– Applying for your first credit card might seem exciting. But do the research first. Often times banks will have college cards. Your credit score will take a 10% hit after opening a new card but will be back up in a year.
- Just One– One card is enough to start building up good credit. It’s easy to keep up with payments and stay in control. Wait at least a year before opening a second.
- Avoid flashy perks- Store credit cards often draw in customers with their rewards. It might sound enticing but focus on a low APR (annual percentage rate) and avoiding fees instead- which store cards often don’t have.
- Start Spending- Simply applying for the card does not help your score. Making purchases then and paying them off is what does it. Set a goal to pay the full amount before the due date and your score will rise.
- Check Your Scores- Head to AnnualCreditReport.com and check your score for free up to 3 times a year. Don’t like what you see? Don’t sweat it- building it back up is possible- I did it. Remember, the U.S. average is 687.
HealthyU™, powered by ACI Specialty Benefits, is a resource for students and faculty members of ACI’s wide range of student assistance program clients. The blog features everything from study tips and time management, to finding important items on a budget and the latest education-based apps and utilities. Want more college tips? Contact ACI Specialty Benefits at (800) 932-0034 or firstname.lastname@example.org.
Anna Goforth, Student Ambassador and College Blogger for ACI Specialty Benefits, is a Journalism and Public Relations student at Point Loma Nazarene University. Anna writes for ACI’s HealthyU™ blog while keeping up with college life. After moving from Alabama to California for college, Anna spent a semester abroad in London where she traveled throughout Europe.