Tips to Build Credit While You’re in College

Become an Authorized User on a Credit Card

One way to begin establishing your credit history is to see whether your parents are willing to add you as an authorized user on one of their credit cards. Becoming an authorized user can help you build good credit because you’ll benefit from their positive payment history and responsible credit use.

Get a Credit Card

Another way to build your credit is to apply for and obtain a credit card. Do your research and find one that’s right for you. Take note of their interest rates, rewards programs, and fees. Don’t just take the first card that says you’re pre-approved. Many companies have cards specifically designed for college students. (Check out our VISA® College Real Rewards Card, specifically designed to help you build credit.)

Use Your Credit Card (Wisely)

To build your credit, simply having a credit card in your name isn't enough. You’re going to have to use it. No, we don't mean a shopping spree. Using your card wisely can help establish your credit history. Designating small purchases to your credit card and paying them off in full at the end of the billing cycle will help keep your credit score high.

Don’t Apply for Multiple Credit Cards

One credit card should be enough while you’re just getting started in establishing your credit. Applying for multiple cards, especially all around the same time, can have a negative impact on your credit score. Each time you apply for a credit card or loan, a lender submits what's called an inquiry, which pulls up your credit history for them to determine whether they can approve your application. Too many inquiries at the same time, and your credit score will take a hit. Also, having multiple credit cards could put you at risk of overspending and getting into overwhelming debt.

Apply for a Share-Secured Loan or Credit Card

Share-secured and certificate-secured loans provide a safe way to help you establish credit. These loans are secured by money you already have in your savings or certificate account. Secured credit cards are another option to help you establish credit. They're also secured by money in your account and provide a revolving source of credit you can continue to use and repay. It's best to choose the option that fits your goals:

• Share-Secured Loans: Perfect if you need a lump sum and a way to borrow against your savings account.
• Certificate-Secured Loans: Ideal for borrowing against a share certificate without triggering any early-withdrawal penalties.
• Secured Credit Cards: Great for everyday purchases and for building revolving credit history. 

Why not make your money work for you and start building your credit?  (Interested in this type of loan? Check out the Share and Certificate Secured Loans and Secured Credit Card that we offer.)

Pay Your Bills on Time

Perhaps the most significant factor in determining your credit score is your payment history. (Read more about understanding your credit report and credit factors.)  Set payment reminders or alerts, or have payments automatically drafted on their due dates to help ensure you don’t miss any payments.

The keys to building your credit are to spend wisely, pay your bills on time, and stay out of debt. We know this is easier said than done, but sticking to a budget and using only one credit card will help you stay on track.