How to Build Credit as a College Student: 11 Tips from Experts (2024)

10/4/2023 By University Frames

Building credit as a college student can be daunting, but it’s achievable with the right tips and guidance. We've gathered tips from industry experts like Chief Marketing Officers, Operations Managers, CEOs, and more to help you with insights for your journey. These insights will set you on the path to a strong financial future.

  • Use Credit Card Responsibly
  • Join a Local Credit Union
  • Manage Your Credit Utilization Ratio
  • Make Student Loan Payments
  • Start with a Student Credit Card
  • Become an Authorized User
  • Limit Your Credit Accounts
  • Follow a Credit-building Strategy
  • Avoid Overly Large Credit Purchases
  • Own Utility Bills in Shared Housing
  • Establish a Budget for Payments

11 Tips to Build Credit as a College Student

Here are the best ways to build credit as a college student. Every way/tip is from industry leaders and experienced professionals.

Use Your Credit Card Responsibly

As a college student, you must wonder how credit cards can help us build a credit score. Here's the answer: When you get your first student credit card, it can be enticing to let it sit around after you've paid your balance. However, the best way is to use your credit card as a debit card. You can use this for bill payments and grocery shopping; however, make sure you pay off your balance each month.

If paying off your balance daily or weekly works better for you, that's okay too! The point is to beef up your history with a variety of transactions. A history of on-time, in-full payments will positively build your credit score and is easy if you are using your card for things you would purchase anyway!

Colin Palfrey, Chief Marketing Officer, Crediful

Join a Local Credit Union

As a college student, I know how challenging it can be to build credit. But it is possible if you're willing to put in some effort and research!

One of the best ways to build credit as a college student is to join a local credit union. You will establish a positive credit history by actively using a credit card or loan from a credit union. The great thing about joining a credit union is that they generally have lower interest rates and fees than other banks. They can also offer great advice and resources to help you stay on track with your credit plan.
Credit unions are often community-focused; they offer special accounts and programs catered toward college students.

Span Chen, Growth Director, Notta

Manage Credit Utilization Ratio

Though your best move with your first credit card is to pay down your loan balance every month in full, you should also be mindful of your credit utilization ratio, or the amount of money you're currently borrowing versus the total available. Your credit score starts to suffer if your utilization ratio reaches 30% or more. So if your only credit product is a $500 credit card, don't let your balance sit higher than $150 or $300 for a $1000 card limit.

If your credit card reaches 30% more than once a month, make payments every two weeks or, as it makes sense—you'll never get dinged for paying down your credit card too quickly, but leaving it too long can become incredibly detrimental. Remember that your utilization ratio combines your total credit, so include your student loans in your ratio calculations.

Jeffrey Zhou, Co-founder, and CEO, Fig Loans

Make Student Loan Payments

To build credit, I would suggest taking a practical approach by making regular payments towards your student loans. Even a small monthly contribution can have a substantial long-term effect.

I began making payments on my student loans while still attending school, and it played a vital role in jumpstarting my credit score. It's important to remember that consistency and meeting your financial obligations are key. Your credit score will gradually reflect your responsible behavior by demonstrating reliability to potential lenders and consistently fulfilling your financial commitments.

Haya Subhan, General Manager, First Aid at Work Course

Start with a Student Credit Card

I started by simply applying for a student credit card. You might be wondering," A credit card in college?" Let me tell you how-
Get a card designed for low-limit students to prevent anyone from going overboard. I used mine for small, manageable purchases like groceries and textbooks, then paid it off monthly.

Student credit cards have helped me establish a payment history, which is a big factor in your credit score. Over time, this strategy helped me build my credit score. Just like a solid workout routine, consistency was key.

So, this is how I built a credit score as a college student. If you also want to build credit, consider starting with a student credit card. It's a small step but can set you up for long-term financial health.

Evander Nelson, NASM-certified Personal Trainer, evandernelson

Become an Authorized User

The easiest way to build credit as a college student is to become an authorized credit card user. You can ask for authorization as a user on a credit card from your parent, guardian, or sibling without actually owning it. This will give you a nice credit boost as long as the card owner never misses a payment. Only certain credit cards report authorized users to credit bureaus, so make sure to do the research on which ones work and which will not.

Max Schwartzapfel, CMO, Schwartzapfel Lawyers

Limit Your Credit Accounts

As a college student with a short credit history, avoid the temptation to open up multiple lines of credit—less is more when first starting. If you open too many credit cards and other loan accounts quickly without a reliable history to back you up, you can get flagged as a risky borrower. And if you try to secure a loan later and can't because of your credit history, you can miss out on some seriously good financial opportunities or get stuck paying higher interest rates.
Instead, focus on one or two credit cards or loans and make regular payments. Those borrowers with longer histories and fewer credit accounts tend to build the strongest scores (and secure the best loans) over time.

Anthony Martin, Founder, and CEO, of Choice Mutual

Follow a Credit-Building Strategy

Building credit can feel like navigating a confusing maze, but it doesn't have to be. First, you need an open credit card in your name. The Discover IT Student card is a brilliant choice for students.

Next, be mindful of spending. Opt for small, routine purchases like your monthly cup of coffee. Aim to keep your usage below 7% of your limit at all times—the sweet spot for credit utilization.

Most importantly, pay your balance in full every month. Timely payments are crucial as they reflect responsible credit behavior.

Essentially, credit building is about establishing credit, maintaining low usage, ensuring full payment, and repeating this cycle. It's about forming habits of responsible credit usage. While building a robust credit score takes time, consistently following this strategy paves the way for a secure financial future.

Josh Schleifer, Founder, Ministry of Credit

Avoid Overly Large Credit Purchases

If you have a stable income and some savings set aside, it's reasonable to expect that you'll be able to use a credit card for indulgences like a holiday or a new TV in a few years. However, it's crucial to spend within your current means.

Accumulating a significant balance that you cannot promptly pay off impacts your credit score and incurs substantial interest charges. Your credit score considers the amount of credit you utilize, so it's essential to be mindful of this factor.

For now, it is advisable to prioritize responsible spending within your financial capabilities, ensuring that you avoid excessive debt and maintain a healthy credit profile. By doing so, you'll be in a better position to enjoy the benefits of using a credit card for larger purchases in the future.

Carl Panepinto, Marketing Manager, Easy Allied Health

Own Utility Bills in Shared Housing

During college, almost every student lives in a shared housing situation. Sharing an apartment or house with roommates is essentially a rite of passage. However, while this is usually one of the best times of your life, no one likes to take ownership of the utilities. Yet, this is a low-impact way to build your credit.

Even having a simple electric or water bill in your name, despite splitting the cost with others, can go a long way toward building up your credit score. These payments are a regular expense; you only pay for a fraction of the total cost, but you get all the financial credit. Taking on the bills is low-hanging fruit for building credit as a college student.

John Ross, CEO, Test Prep Insight

Establish a Budget for Payments

Establishing a budget is an important step to building credit as a college student. Creating a budget allows you to effectively manage your finances, ensuring you have sufficient funds to make timely bill payments.

You can maintain a positive credit history and improve your creditworthiness by avoiding late or missed payments.

Jason Cheung, Operations Manager, Credit KO

Final Takeaway

We have explored various ways to build credit, from using credit cards responsibly to establishing a budget for payments.

By implementing these strategies, you can establish a positive credit history and pave the way for a strong financial future.

It's important to remember that building credit takes time and consistency, so be patient and stay committed to your financial goals.

Take control of your financial future and start building your credit today. Your choices will have a lasting impact on your financial well-being, so make them wisely and watch your credit score soar.

How to Build Credit as a College Student: 11 Tips from Experts (2024)


How to Build Credit as a College Student: 11 Tips from Experts? ›

Maintain a solid payment history

Keeping up with your credit card payments is the most important factor in building your credit score. Payment history makes up 35 percent of your credit score calculation and signals that you know how to use credit responsibly.

What is a tip for a college student to improve their credit score? ›

Maintain a solid payment history

Keeping up with your credit card payments is the most important factor in building your credit score. Payment history makes up 35 percent of your credit score calculation and signals that you know how to use credit responsibly.

How can college students build their credit? ›

Here are some options to consider.
  1. Get a Secured Card or Student Credit Card. Student credit cards are designed specifically for college students. ...
  2. Become an Authorized User. ...
  3. Open a Credit-Builder Loan. ...
  4. Get Credit for Rent Payments. ...
  5. Practice Good Credit Habits. ...
  6. Check Your Credit Report. ...
  7. Monitor Your Accounts.
Jan 26, 2024

How can 18 year olds build credit? ›

How to Start Building Credit at 18
  1. Open a student credit card. One of the more popular options for establishing credit is opening a student credit card, which is unsecured. ...
  2. Get a secured card. ...
  3. Take out a loan. ...
  4. Try a credit-builder loan. ...
  5. Automate your payments.

Which is the best way for a college student to start building their credit score budget challenge? ›

If you have a cosigner, consider using your card to make small purchases and pay off the balance every month. This strategy can help you build credit in college. Pros: Having a credit card that you can pay off entirely each month will demonstrate your ability to make timely payments.

How to get 20 credits in college fast? ›

10 Fastest Ways to Earn College Credit
  1. AP Exams.
  2. Accelerated College Classes.
  3. CLEP Exams.
  4. DSST Exams.
  5. TECEP Exams.
  6. Certifications & Licenses.
  7. Military Experience.
  8. Volunteer Work.
Feb 27, 2024

How to get 800 credit score in college? ›

These are some of the steps that can put you in the right path.
  1. Check your credit history. If you've never had credit before, the credit bureaus may have little or no information on you. ...
  2. Open a student credit card. ...
  3. Or apply for a secured credit card. ...
  4. Make your payments on time. ...
  5. Keep your credit usage low.

How to get 15 credits in college fast? ›

If the college offers accelerated classes, you can typically earn 15 college credits in 12 to 16 weeks. If you want to speed up the process, you can also take CLEP or DSST exams to help you earn your college credits at a faster pace.

How do you actually build credit? ›

  1. Pay credit card balances strategically.
  2. Ask for higher credit limits.
  3. Become an authorized user.
  4. Pay bills on time.
  5. Dispute credit report errors.
  6. Deal with collections accounts.
  7. Use a secured credit card.
  8. Get credit for rent and utility payments.
Mar 26, 2024

What are the 5 factors of credit score? ›

What's in my FICO® Scores? FICO Scores are calculated using many different pieces of credit data in your credit report. This data is grouped into five categories: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%) and credit mix (10%).

How can I get credit with no credit history? ›

7 Ways to Build Credit if You Have No Credit History
  1. Become an authorized user.
  2. Try a credit-building debit card.
  3. Apply for a secured credit card.
  4. Apply for a credit-builder loan.
  5. Apply for a store credit card.
  6. Have rental payments reported.
  7. Establish credit with Experian Go™
Feb 13, 2024

How does a 19 year old establish credit? ›

As you transition into adulthood, you can establish credit by getting a credit card or loan, using special credit-building products or by becoming an authorized user on your parents' credit card.

How to get a 650 credit score at 18? ›

Payment history is a very important factor in your credit score, so making payments on time is one of the best things you can do to build credit. Making timely payments goes beyond your credit card balance. You want to make timely payments on all your bills — car loans, student loans etc. — to establish good credit.

What is the easiest way to build credit responsibly? ›

One especially effective way to build credit is to open your own credit card account. Responsible credit card use, such as making timely payments and keeping balances low, can help you establish a positive credit history. If you have no credit history or poor credit, you may need to explore secured credit cards.

What is a good credit line for students? ›

What is the average credit limit for a college student? If you're a college student with limited to no credit history and are looking for your first credit card, you can expect a credit limit of $500 to $1,500.

How can a college student be financially smart? ›

You'll learn how making even the smallest adjustments to your financial decisions can have big impact when you graduate.
  1. Take a money inventory. ...
  2. Set a budget and track expenses. ...
  3. Open a savings account in addition to a checking account. ...
  4. Automate finances. ...
  5. Student discounts. ...
  6. Watch out for recurring expenses and fees.

What are five 5 tips for improving your credit score? ›

Here are five credit-boosting tips.
  • Pay your bills on time. Why it matters. Your payment history makes up the largest part—35 percent—of your credit score. ...
  • Keep your balances low. Why it matters. ...
  • Don't close old accounts. Why it matters. ...
  • Have a mix of loans. Why it matters. ...
  • Think before taking on new credit. Why it matters.

What are 4 ways to improve your credit score? ›

How do you improve your credit score?
  • Review your credit reports. ...
  • Pay on time. ...
  • Keep your credit utilization rate low. ...
  • Limit applying for new accounts. ...
  • Keep old accounts open.

What is the best thing that you can do to improve your credit score? ›

The most effective way to improve your credit is by slowly paying down the amount you owe. 5. Use credit cards – but manage them responsibly. In general, having credit cards and installment loans that you pay on time will raise your score.

How should I improve my credit score? ›

  1. Avail Secured Credit Card. ...
  2. Refrain from Closing Old Credit Card Accounts. ...
  3. Monitor your Co-signed, Guaranteed or Joint Loan Accounts Regularly. ...
  4. Choosing a Longer Repayment Tenure. ...
  5. Trying to Increase your Credit Limit. ...
  6. Trying to Maintain a Healthy Credit Mix.
Apr 1, 2024

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