Piggy bank with coins

A good credit score makes it easier to rent an apartment, buy a car, or take out a loan with lower interest rates. Yet, many teens don’t consider building credit until after graduation — only to realize they could’ve started much earlier. It’s easy to get going, if you know what you’re doing. Follow these tips to get a head start on building your credit history from scratch.

What Makes a Good Credit Score?

Fair Isaac Corporation’s breakdown of what makes a good credit score.

According to Fair Isaac Corporation, a good credit score is made up of five factors: payment history, amounts owed, length of credit history, new credit, and credit mix.

Here’s 5 tips to help you stay on top of your credit health:

Do Your Research & Get the Best Credit-Card for You

Teenage girl holding credit cards

Don’t apply for just any credit-card — be smart about it. A student card may seem like an obvious choice, but being a student doesn’t guarantee you’ll get approved. Student cards usually require some income and credit history. Don’t worry! If you can’t get a student card, you still have other options:

Become an Authorized User or Get a Co-Signer

Ask a family member with strong credit standing to add you to their account, or co-sign your application.

  • As an authorized user, you’ll receive a card that’s linked to the primary cardholder’s account, who is fully responsible for payments.
  • If you get a co-signed card, you’ll be responsible for payments. The co-signer is liable only if you can’t pay.

Get a Secured Credit Card

You’ll have to pay a cash deposit, which becomes your credit limit. For instance, a $300 deposit = a $300 spend limit on your card.


  • Get a card with no annual fee and ensure interest rates are low.
  • Look for cards with perks — student discounts, rewards, tracking tools, etc.
  • Compare credit cards online — try Credit Karma or NerdWallet.

Make a Budget & Use Your Credit Card Wisely

Teenage girl sitting at table, counting coins and writing notes.

Simply having a credit card won’t build credit. Begin charging small expenses to demonstrate your ability to manage credit, but do so wisely.

Spend Within Your Means

Never charge more than you can afford to pay each month — know your recurring expenses, make a budget, and use tracking tools to stay in check.

Be Mindful of Your Credit Limit

Credit utilization ratio is important. Using a high percentage of your credit limit, and getting close to “maxing out” your card, has a negative impact. Using a low percentage has a positive effect.


Make Bill Payments On Time & In Full

Online bill payment

According to FICO’s® breakdown, the two most important factors in building credit are payment history and amounts owed — together, they make up 65% of your credit score!

Always Pay Your Bill on Time

Do whatever it takes to remember due dates — set up account and payment alerts if needed. Late payments are the quickest road to low credit scores.

Pay the Full Amount

Avoid accruing interest by ensuring you don’t carry an unpaid balance. Even if you can’t pay in full, always pay more than the minimum requirement — this reduces interest and debt.


  • Take advantage of online payment and reminder systems, to pay your bills quickly and easily.
  • Set up auto-payments and never miss a bill, but always ensure there’s enough money in your account.

Get a Credit Report & Monitor Your Score

Credit score displayed on iPad using the Mint app

Studies reveal, getting a copy of your credit report increases credit knowledge and puts you in a better position to track and improve your credit health.

Get Your Credit Report

Credit Bureaus are required by federal law to provide a free report annually. Understand the information in your report, and make sure there aren’t any errors.

Check and Monitor Your Credit Score

Check on your credit health 2–4 times a year so you know exactly what to improve — some apps/websites allow you to do this for free.


Mix it Up: Diversify Your Loans

A desktop, mobile phone, and tablet with credit graphs

Although new credit and credit mix are the two smallest factors in credit score (10% each), you can benefit from maintaining and paying off a good mix of revolving credit and installment accounts. However, over-applying for credit can be damaging.

Don’t Open New Accounts too Rapidly

Opening multiple credit accounts in a short amount of time can represent a greater risk , and it lowers your average account age.

Get Different Types of Credit

A mix of credit can have a positive impact if each of your credit cards, student/installment loans, and retail accounts have a good payment history.


  • Don’t open accounts you won’t use — get the ones you’ll use and maintain.
  • Closed accounts don’t go away — their history shows up on credit reports.

The Bottom Line

Get a credit card that suits you, use it wisely, make a budget, and be responsible with your expenses — most importantly, make payments on time and start building credit early. Establishing good credit habits in school will lay a strong foundation for the future, putting you a step ahead of your classmates by the time you graduate. Start implementing these tips now, and experience how rewarding a great credit score can be.

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