How to Start Building Credit at 19
Having a good credit score is important for many reasons, such as getting approved for loans, mortgages, and even jobs. Unfortunately, teenagers often lack the credit history needed to build a good score. But, this doesnt mean its impossible to start building credit at 19. With some dedication and the right strategies, you can begin to build a strong credit history and score. Here is a guide to getting started.
1. Apply for a Secured Credit Card
A secured credit card is a great way to start building your credit. This type of card requires you to put down a deposit usually around $200 which acts as your credit limit. As long as you make your payments on time and keep your balance low, you will slowly start to build good credit.
2. Become an Authorized User on Someone Elses Card
If you have a parent, family member, or friend who trusts you and is willing to let you become an authorized user on their credit card, it can be a great way to get started with building your credit. This persons account activity and credit score will be reported to your credit report, which will help you build your own credit score.
3. Become a Cosigner
If you cant become an authorized user, you can always become a cosigner on someone elses loan or credit card. This means that you will be responsible for making payments if the primary cardholder is unable to do so. Being a cosigner can be a great way to build your credit score if you make all of the payments on time.
4. Make Payments on Time
Whether you have a secured credit card, are an authorized user, or are a cosigner, its important to make all of your payments on time. This is one of the most important factors in determining your credit score. Set up automatic payments if possible, so that you dont have to worry about missing a payment.
5. Keep Your Balances Low
Another important factor in building a good credit score is keeping your balances low. This means that you should try to use as little of your available credit as possible. Aim to keep your credit utilization ratio below 30 percent, and try to pay off your balance in full each month.
6. Monitor Your Credit Report
Finally, make sure you keep an eye on your credit report. You can get a free credit report from the three major credit bureaus (Equifax, Experian, and TransUnion) once per year. This will help you identify any errors that could be impacting your credit score.
Building a good credit score at 19 can be challenging, but its definitely possible. By following these tips and strategies, you can start to build your credit and eventually have the financial freedom that comes with a good credit score