Monday, December 12, 2011

How Do You Get Credit?(I'm a Teen And Curious)?

I'm 15,turning 16 in December,and living in the US,obviously I have no issue with credit and have no reason to worry,but in my algebra class,some of the Juniors were talking about how they want to start getting credit or building credit,and now i'm curious as how to do so?

My mom says she has bad credit and that's why I can't get an iphone,but when i'm 18 I want to be able to buy some things(not over doing it) that she can't.

How do you build credit or get credit and at what age is it a good time to start?How Do You Get Credit?(I'm a Teen And Curious)?
credit cards were originally designed for businessmen with high

incomes. things are easy to buy at first,but dont be fooled. also

its easy to get into a situation where your short of money and you

think ';ill use the credit card.';

once becomes twice and before you know it your in over your head.

being broke all the time because you have to repay the credit

card makes you unhappy and depressed. ask your mum!

save cash. you will always be glad you did. while your friends

are panicking ';where will i get the money to pay the credit

card'; you can feel free and buy the stuff everyone else has. soon

those friends wont be able to buy anything because credit card bills

are killing them anyway.

it might take a bit longer but believe me you will never regret it.

just read the mega problems other people are having with credit cards.How Do You Get Credit?(I'm a Teen And Curious)?
You do want to establish credit when you are 18 but not for the purpose of buying toys. You want to save your money for those items and pay cash.

You are old enough now to establish a good relationship with a bank. Open a savings account and let the balance build up over time. Later, this will help you get a credit card, which you need to pay on time every month.

Perhaps you can encourage your mom to improve her credit now as you will need a co-signer to get a credit card at 18 under the new laws.
Hi Ely,

Congrats on being proactive and educating yourself early! Starting with your first credit card, everything you do that involves credit becomes part of your credit history. To have a good credit history, you have to use credit responsibly.

1. Charge only what you can afford to pay. When you get into the habit of charging only what you can afford, it lets future lenders and creditors know that you are a responsible borrower.

2. Use only a small amount of the credit you have. Maxing out your credit cards ?or even coming close ?is one of the most irresponsible ways of using credit. Staying below 50% of your credit limit is wise, below 30% is best.

3. Start with only one credit card. Many first-time credit card users accumulate a collection of credit cards within their first few years of using credit. Don't do this. The more credit you have, the more you'll end up using. Learn how to be responsible with credit before you apply for additional credit cards.

4. Pay your balance in full and on time. Paying off your balance each month shows that you're capable of paying bills, something creditors and lenders want to see. Since a large part of your credit score includes timeliness of your payments, paying your balances on time improves your credit.

5. Carry a balance the right way. Having a credit card balance isn't bad as long as you do it the right way. Make more than the minimum payment each month to pay off your balance as quickly as possible. Avoid making late credit card payments and continue to keep your balance at a reasonable level.

Hope this helps!


Brad, Personal Finance Educator
At age 18, deposit money at a bank that offers ';secured'; credit cards to depositors without any credit and obtain a ';secured'; credit card from that bank. Make all required payments on time and in the required amounts. Currently, this is the only way to start building credit, because it is not currently possible to obtain other types of credit cards if you do not already have credit.

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