Learn how to build credit at 18? It’s actually very simple and easy to understand. If you want to raise your credit score you have to be prepared to do so. Thus far, you have not earned the right. Learn to build credit at 18 and set yourself up.
However, if you’re serious about becoming creditworthy, and you want to improve your finances. you can learn how to build credit at 18, 19, 21. Upgrade not only your whip, but your lifestyle, then read on.
In order to prepare yourself for financial success, in this ever-changing economy, you need to know credit.
There are 5 factors to your credit score. These are listed below.
Your payment history 35%
As a rule of thumb, pay your bills on time. This is the battle half won. Before a creditor give you a CC (before a creditor approves you credit) they want to be sure you can afford your bills. This is a way to show your creditworthy becoming responsible and showing you’re responsible paying opff your bills and gaining trust.
Don’t live above your means. Reasonable purchases makes for reasonable payments. Be sure before making any major purchases. Also, if you have collections. Make your priority paying off those debts before you look to make new ones.
Credit Utilization 30%
The sweet spot here is to have amounts owed no more than thirty percent. That’s to say for all credit available to you, you don’t want to overspend, keep a credit balance well below one-third. The key here to know is priority, credit utilization amounts for thirty percent, while payment history thirty-five percent. However, credit utilization is not nearly as priority as payment history. I explain more in detail in Title, link. Basically, amounts owed while very important, does not have a lasting impact.
Length of Credit History
A forty year old with years of experience is more creditworthy than a twenty-one year old working minimum wage with a red convertible.
Types of Credit
Auto. Home. Student
The kinds of assets you have. The kinds of debts you have. Assets vs. liabilities
New Credit
While length of history is not as _ There’s only so much you can do _ ( The day open your debt is no longer in your control) At least keep a good relationship with your creditor. Work on Long Term relationships and try to avoid closing your account by defaulting to collectors. Otherwise keep your attention on 1 and 2.
- Live within your means.
- Pay your bills in a timely manner. If possible, pay them early this is the battle half won.
- Automate your payments, know when your billing cycle begins and have an automatic payment scheduled before it ends.
- Pay more than the minimum, see, Interests Blunders. Big loan-small interests, small loan-big interests, debt looms around the corner. Especially, with credit cards see, The Perfect Debt trap – Be responsible.
- Keep your balance low. You can do this by reducing spending, buy bargain prices, purchase alternative brands. Only use for something you would really need.
- *Have most the money for it
- Be sure to pay to the principal. Don’t have all your money eroded by Interest.
- When money is tight, in these times, set your autopay to the minimum. There’s no use making a payment you cannot afford only to have missed a payment. *It could take months to regain your work.
- Collections, for any discrepancies visit annualcreditreport.com
- Learn how to build your credit at 18