{"id":2774,"date":"2018-10-11T16:11:23","date_gmt":"2018-10-11T16:11:23","guid":{"rendered":"https:\/\/sites.austincc.edu\/money\/?p=2774"},"modified":"2018-10-11T16:11:23","modified_gmt":"2018-10-11T16:11:23","slug":"how-to-start-building-credit","status":"publish","type":"post","link":"https:\/\/students.austincc.edu\/money\/smmo-blog\/how-to-start-building-credit\/","title":{"rendered":"How to Start Building Credit"},"content":{"rendered":"<p>One of the many questions we get at the Student Money Management Office is about how to go about building credit. As a college student, this is your time to start building healthy habits&#8211;and that includes healthy credit habits, too!<\/p>\n<p>The main way to start building credit is to apply for a secured credit card. Chances are, if you don&#8217;t have any credit and you go apply for a credit card, the bank will reject you based on the fact that you are &#8220;credit invisible.&#8221; Most of the time, though, they can offer you a secured credit card to get you started.<\/p>\n<p><strong>What is a secured credit card?\u00a0<\/strong><\/p>\n<p>A secured credit card is like training wheels for credit building. The card is backed by a cash deposit made by you&#8211;which is often equal to your credit limit. If your deposit is $300, then your credit limit should be $300. The reason why the bank asks you for a deposit is to reduce risk on their part.<\/p>\n<p>Apart from that, a secured credit card works like any other credit card: you buy something with it, pay the balance (in full if possible) before your next statement, and interest will be accrued if you don&#8217;t pay your balance in full. Your cash deposit acts as a safeguard in case you stop making payments.<\/p>\n<p>A secured credit card is actually not meant to be used forever. Its purpose is to get you ready to qualify for an unsecured credit card&#8211;ones that don&#8217;t require you put in a deposit, and better benefits.<\/p>\n<p><strong>Tips to get your credit building journey started:<\/strong><\/p>\n<ul>\n<li>Make your payments on time! Even if you only have money at the time for the minimum payment, still do it. Making late payments hurts your credit, and is a trap that can cost you more than late fees&#8211;35% of your credit score is based on your payment history, so if you are perpetually late on your payments, your credit score will reflect that.<\/li>\n<li>Keep your credit utilization low. A good rule of thumb is to not exceed usage of 30% of your credit card limit. This means that once your credit utilization goes above 30% it can make your credit score go down.<\/li>\n<li>Don&#8217;t open too many accounts at once! This is also true for those of y&#8217;all who keep applying for credit cards\/accounts and get rejected. Even if you get rejected, your credit takes a temporary hit because this is considered a\u00a0<em>hard inquiry\u00a0<\/em>into your credit.<\/li>\n<li>Make sure you research where you are going to bank. Your first credit card is pretty much your credit card forever&#8211;as closing old accounts can damage your average credit age. When you close an old credit card, it brings your average credit age down&#8211;the higher it is, the better! So research your banking institution!<\/li>\n<li>Monitor your credit report\u00a0<em>at least\u00a0<\/em>once a year. <a href=\"https:\/\/sites.austincc.edu\/money\/credit-reports-scores\/\">Visit our section on credit reports and scores<\/a> and learn more about how you can become a champion at monitoring your credit!<\/li>\n<\/ul>\n<p>As always, take control of your money (and your credit) the smart way!<\/p>\n","protected":false},"excerpt":{"rendered":"<p>One of the many questions we get at the Student Money Management Office is about how to go about building credit. As a college student, this is your time to start building healthy habits&#8211;and that &hellip; <a href=\"https:\/\/students.austincc.edu\/money\/smmo-blog\/how-to-start-building-credit\/\">Continue reading <span class=\"meta-nav\">&rarr;<\/span><\/a><\/p>\n","protected":false},"author":90,"featured_media":2785,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[6],"tags":[28],"class_list":["post-2774","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-smmo-blog","tag-credit"],"_links":{"self":[{"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/posts\/2774","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/users\/90"}],"replies":[{"embeddable":true,"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/comments?post=2774"}],"version-history":[{"count":0,"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/posts\/2774\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/media\/2785"}],"wp:attachment":[{"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/media?parent=2774"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/categories?post=2774"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/students.austincc.edu\/money\/wp-json\/wp\/v2\/tags?post=2774"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}