09.02.09 | Increase Your Credit Score While in School
While your top priority is scoring well on exams, there is no reason you can’t kill two birds with one stone and enhance your credit score at the same time. With a little knowledge and know how you can make it happen.
How to build credit while in school
- Auto debit: Instead of paying for your books in cash charge them on your credit card and setup a reoccurring auto debit for several months until the books are paid in full. It may cost you an additional $15-$25 in interest over that time but you will be saving yourself money in the long run.
- Don’t sign up: You may see several credit card companies on campus this fall chasing you down with a free t-shirt to sign up for their card, and though it may help you put off laundry one more day, don’t do it. Multiple queries into your credit are not favorable. In fact, they can actually decrease your credit score.
- Low balance: Keep your balance relatively low in relation to your total credit line. By keeping a favorable debt to credit line ratio you will score valuable points.
- Keep one card: Don’t bounce from card to card or stockpile multiple cards. Keeping one card for an extended period of time holds significantly more value than hoping around.
- General purchases: Credit cards are great for everyday purchases like groceries and gas, provided you can pay them off at months end. Again, it’s all about getting on the grid and displaying a positive credit history.
Check out the BEST credit cards for students »
When is your credit score most commonly viewed
- When applying for a credit card
- When leasing an apartment or buying a house
- When purchasing a car
- When taking out any type of loan (personal, equity, etc)
- When applying for employment for many professions
Can a prepaid card help me build credit?
No. You need to have an actual credit line extended to you to strengthen your credit score. You don’t actually borrow money with a debit card. Building good credit is all about borrowing money and making on time payments. As you establish a positive credit history your credit score will rise and your interest rate will drop. That said, debit cards are a good way to get your feet wet.
Debit cards work the same as a credit card in the sense that you can make purchases online, over the phone, and in stores. You can also take cash withdrawals from ATM’s. If your parents are steadfast against you having a credit card you may want to suggest a prepaid card to prove to them how responsible you are before graduating to a credit card.
ScholarshipPoints code: BLDCREDIT
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September 2nd, 2009 | #
Wow, I never knew that having a credit card could help me out! One of my friends in college told me to have one just in case, but I did not want to have even a speck of debt. Thanks for clearing that up!
September 2nd, 2009 | #
Thanks Professor you really know how teach a good course. ^.^
September 3rd, 2009 | #
[...] Build Your Credit Score While in School [...]
September 22nd, 2009 | #
There will be education offered exsten on the high school and freshman level by 2011
September 22nd, 2009 | #
great~
October 9th, 2009 | #
Thanks I didnt know there was a smart way to really use a credit card besides not actually having one
October 11th, 2009 | #
This is really helpful information I was always under the impression that multiple cards were good for you.
October 12th, 2009 | #
I have a student credit card too. It helped a lot during tough times but remember to pay the due date! Or else you’ll be charged over 30 dollars!
October 13th, 2009 | #
I found this info. really helpful. I unfortunatly have bad credit due to numerous doctor bills. I wasn’t sure how to begin repairing my credit until now.
October 14th, 2009 | #
Amazing info. Definitely something to always keep in mind.
October 14th, 2009 | #
i may get a credit card now…. =]
October 16th, 2009 | #
This was really good information to read. It helped a lot.
October 17th, 2009 | #
this info is very helpful.
October 17th, 2009 | #
This is interesting information that I didnt now. Im glad that I read it.
October 18th, 2009 | #
Ive found this information very helpful and will be sure to share it with my peers
October 19th, 2009 | #
good info
October 19th, 2009 | #
It is definitely something to think about because I never knew that having a credit card could help me.
October 20th, 2009 | #
Great advise. I’m going to have to talk to my parents about this!
October 25th, 2009 | #
I will a credit card now, great info I pass it on to my friend
October 26th, 2009 | #
its great
October 27th, 2009 | #
I HAVE TO BUILD MY CREDIT.. SO THIS IS GOOD TIPS
October 28th, 2009 | #
very helpful.
October 28th, 2009 | #
This was very seful
October 28th, 2009 | #
I’ve been told these exact same info by my sister, but I did not entirely understood her. However, I have been meaning to create a credit card and slowly build up my credit score.
November 3rd, 2009 | #
useful indeed!!!
November 6th, 2009 | #
good info
November 8th, 2009 | #
THIS INFORMATION WILL BE USEFULL WHEN I BEGIN TO USE CREDIT CARDS.
November 9th, 2009 | #
printed it out and posting it on my board im going to need to remember that
November 10th, 2009 | #
im afraid to get a credit card while in school but i realize that it is a necessity.
November 19th, 2009 | #
great reading thank you
November 20th, 2009 | #