3 Tips for Building Good Credit as a College Student

Building good credit in college is crucial because of the many demands that follow graduation. Credit checks are frequently necessary in the hiring process and when applying for an apartment lease, a poor score will limit your opportunities. The strategies outlined below can boost your score with minimal effort.

1. Avoid Overdrafts

College is one of the easiest times to take too much out of your checking account, due to the heavy presence of impulse purchases. Be aware at all times of how much money is in your account, including checks and debit card transactions that haven't cleared yet. That way, you'll know whether or not you can afford that cab home or large pizza for all your friends at the end of the night.

While over-drafting your account doesn't have quite the impact on your credit that defaulting on a major loan does, going into the red can definitely bring you down, especially if you do it often. And over-drafting even a dollar or two will bring a pesky fee of $30 to $40 dollars.

2. Pay Manageable Bills

Demonstrating your ability to make timely payments on bills is an easy, efficient but effective way to maintain good credit. You most likely won't have the means in college to make entire rent or car payments, but look to small bills like gas, electric, cable or internet. If you live in an apartment, volunteer to be the roommate in the house with at least one of these bills in your name. You can work out an arrangement to make sure the other roommates pay you their portions of the bill in time, but having the bill come from your checking account can be great for credit if it's paid on time. 

3. Police Yourself with a Credit Card

Many suggest obtaining a credit card while in college as a means to building good credit, but abuse of the card is a direct obstacle to that goal. Ideally, if you complete the first two steps successfully, you'll already be well on your way to achieving a top-notch score. However, many keep credit cards in college for absolute emergencies, such as plane tickets home or medical expenses. When you are getting used to the power of credit, be sure to use the card exclusively for these purposes and pay it off as soon as the bill comes in.

If you've proven that you can handle the freedom, pull the card out for more regular expenses such as food. Pay for groceries with the card and then put it away in your drawer the rest of the time. If you find yourself justifying luxury purchases with the fact that the bill won't come in for a month or that you have months of 0% APR, have a friend take the card from you and stow it away. Don't use a credit card for anything you wouldn't use your debit, cash or checking account to purchase. 


Improve Your Credit Score - Free Consultation

Need debt consolidation relief? Click here!