Magellan Financial Advisors

Asset & Wealth Management in Allentown, Pa

The life you imagine is built on the decisions you make today.

 610-437-5650

  •  Home
  • Services
    • Our Financial Services
    • Wealth Planning
    • Investment Planning
      • Wells Fargo Advisors’ Envision® Process
      • Investment Planning Process
      • Life Insurance Services
      • Estate Planning Strategies
    • Impact Investing
    • Investment Management
    • College Savings Plans
      • College Savings Basics: How & When To Save
    • Retirement Planning Services
      • Retirement Is For Living
      • 401k Retirement Plans
      • Social Security & Medicare Benefits
    • Business Financial Services
  • Team
    • Our Team
    • Whom We Serve
    • Get Started Now
    • The Client Relationship
  • Work At Magellan
  • Knowledge Center
    • Blog
    • Market Reviews
    • Education
    • Helpful Resources
  • Contact

How College Students Can Build Good Credit

Aug 13 2019

College students have a big disadvantage with credit as they likely do not have a credit score and are starting from scratch. As students continue to gain and further their independence, they also take on an abundance of responsibilities, many of which are financial. A lot of these financial responsibilities require having a good credit score.

How College Students Can Build Good Credit - Financial Advisors
Getting your initial credit started can be a challenge. To get started, use one of these three credit-building strategies:

1. Apply For a Secured Credit Card

A secured credit card is backed by a cash deposit you make up front. This card is not meant to be used forever, just until you have enough credit history to get an unsecured card.

2. Have a Cosigner

In a time when you’re gaining independence and truly becoming an adult, don’t forget about your parents/guardians. Having a cosigner will allow you to get a loan or a secured credit card. Also, due to the Credit CARD Act, people under the age of 21 now must have a cosigner or show proof of independent income. If this applies to you, having a cosigner isn’t just a good idea, it’s mandatory.

With that being said, make sure both you and the cosigner knows what being a cosigner entails.

3. Become an Authorized User on Someone Else’s Credit Card

Again, this is an instance where your parents/guardians can be very helpful. Being an authorized user has several benefits:

  • It gives you access to a credit card and allows you to begin building a credit history.
  • It allows for parents to monitor your spending to ensure it does not get out of hand.
  • Credit card payment liability does not fall on you. With that being said, you and the primary user should come to a fair payment agreement, just in case this should happen (even though you aren’t legally obligated to do so).

How To Build Good Credit:

Now that you’ve established a strategy, it’s time to begin the process. Below are tips and methods for building your credit score:

  • Make 100% of your payments on time, including credit cards, utilities, and/or your cell phone.

  • Keep your utilization levels low (balance vs. credit limit).

    • Your balance is the current amount you owe on your account. Your credit limit is the amount of credit you are able to spend up to.
  • Start with one card. Do not open too many new accounts.

    • You may get a nice discount on purchases at various retail stores, but doing this too many times will negatively impact on your credit score.
  • Pay your credit card balance in full each month.

  • If you need to carry a balance, pay it off as quickly as possible.

    • Emergencies happen, you need to ensure you’re financially secure.
    • Pay off a big purchase over a few months. Spread out the impact, don’t drain your account all at once.
    • Do not continue to put more onto the card.
  • Keep accounts open / let your accounts age.

    • The age of your credit history essentially shows the length of your experience with the credit system. This is meant to speak to your experience levels and responsibility when it comes to credit cards, loans, and other forms of borrowing. The longer your account has been open, the less perceived risk.

In Conclusion

Check your credit report annually for possible errors. You are entitled to a free credit report every year (https://www.usa.gov/credit-reports) at annualcreditreport.com from the three rating agencies (Transunion, Experian, Equifax).

For more information please contact our team of financial advisors, today!
Summary
How College Students Can Build Good Credit
Article Name
How College Students Can Build Good Credit
Description
College students face an uphill battle when it comes to credit. These strategies & tips will help build good credit to ensure a promising financial future.
Author
Jonathan Soden
Publisher Name
Magellan Financial Inc.
Publisher Logo
Magellan Financial Inc.

Categorized: Educational Planning Resources, Family & Finances
Tagged: building good credit, college students, credit cards, how to build credit

Recent Posts

  • Monthly Stock Market Review – February 2023
  • Monthly Stock Market Review – January 2023
  • Stock Market Outlook 2023
  • Monthly Stock Market Review – November 2022

Categories

Archives

Blog Subscription

Contact Magellan Financial Advisors

MAGELLAN FINANCIAL, INC.

1605 N Cedar Crest Blvd #111
Allentown, PA 18104 USA

 610-437-5650

Toll Free:  1-888-437-5650
Fax:  610-437-5654
Email:  Rob.Cahill@WFAFiNet.com
Click Here for Directions

Financial Services

  •  Investment Planning
  •   Investment Management
  •   Business Owners
  •   Retirement Planning Services
  •   401(K) Retirement Plans
  •   Socially Responsible Investing

Client Resources

  •   Educational Resources
  •   Family & Finances
  •   Business Financial Services
  •   Stock Market Review
  •   Retirement Planning
  • Life Insurance
Investments in Securities and Insurance Products:
Not Insured by FDIC or any Federal Government Agency
May Lose Value
Not a Deposit of or Guaranteed by a Bank or Any Bank Affiliate

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN). Wells Fargo Advisors is a trade name used by Wells Fargo Clearing Services, LLC (WFCS) and Wells Fargo Advisors Financial Network, LLC, Members SIPC, separate registered broker-dealers and non-bank affliates of Wells Fargo & Company. WellsTrade brokerage accounts are offered through WFCS.

This information is intended for use only by residents of AZ, CA, CO, CT, DC, DE, FL, IL, IN, MA, MD, NC, NJ, NM, NY, OH, PA SC, UT, VA, VT, WA, WI. Securities related services by Magellan Financial, Inc., may not be provided to individuals residing in any state not listed above. Insurance-related services may be provided by Robert I. Cahill, CFP, Managing Partner, only to individuals residing in: AZ, CO, FL, MA, NJ, NY, PA, SC, VA.

A Note About Social Media
Opinions, comments and actions taken on Social Media are those of the third party and do not necessarily reflect the views of the creator of this profile or of the firm. Social Media is intended for U.S. residents only and subject to the following terms: wellsfargoadvisors.com/social.

Privacy Policy | Legal | Security | Sitemap ©2023 Magellan Financial, Inc. | All Rights Reserved Designed And Developed By DaBrian Marketing Group, LLC.
MENU
  •  Home
  • Services
    • Our Financial Services
    • Wealth Planning
    • Investment Planning
      • Wells Fargo Advisors’ Envision® Process
      • Investment Planning Process
      • Life Insurance Services
      • Estate Planning Strategies
    • Impact Investing
    • Investment Management
    • College Savings Plans
      • College Savings Basics: How & When To Save
    • Retirement Planning Services
      • Retirement Is For Living
      • 401k Retirement Plans
      • Social Security & Medicare Benefits
    • Business Financial Services
  • Team
    • Our Team
    • Whom We Serve
    • Get Started Now
    • The Client Relationship
  • Work At Magellan
  • Knowledge Center
    • Blog
    • Market Reviews
    • Education
    • Helpful Resources
  • Contact