Maria Adams, Credit Cards Moderator
The best way for a beginner to build credit is to get a credit card in their name and use it responsibly. All major credit cards report account information to the credit bureaus each month, allowing you to build credit history. As long as the information shows on-time payments and reasonable credit utilization, that credit history will be positive and you’ll be on your way to building a good credit score.
Best Credit Cards for Beginners to Build Credit
How to Build Credit as an Authorized User
Another way for a beginner to build credit is by becoming an authorized user on someone else’s account. In fact, if you are under 18 years old, this is the only way to get access to a credit card. Once a authorized user is added to a credit card account, the issuer will begin relaying account information to the major credit bureaus on a monthly basis under the authorized user’s name. As long as the account is managed well, the authorized user’s credit report should reflect positive information.
How to Build Credit Without a Credit Card
You can also build credit without a credit card. For example, you could get a loan. Most types of loans report account information to the major credit bureaus on a monthly basis, allowing you to build credit if you pay your bill on time.
Using a credit card responsibly is the best way to build credit. But no matter which credit-building method you choose, your credit will only improve if you borrow responsibly. And above all else, that means always paying your bills on time.
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