Why is it Important to Build your Credit Score as a College Student

Although most college students get into debt during their varsity years, there is another way. It is entirely possible to make some financial choices during your studies that impact positively on your credit score. Thinking more about the long–term implications of your spending habits during your years of studying is strong motivation to spend smart and save even smarter.

Why is it important to start building good credit in college?

Portrait of thoughtful woman in graduation gown with diplomaThese are likely to be your first years as a creditworthy individual. This is because a person comes of financial age at 18, enabling them to apply for their first non-co-signed credit card and begin building their credit score. The idea is to “start as you mean to go on” and begin creating a positive credit history. These first years are crucial for your twenties’ financial health as the reports sent to the credit bureaus about your repayments, applications, debt and general credit conduct will be all potential lenders have to judge you on. Starting with good habits shows lenders that you are responsible and an attractive creditor.

Making a good impression in college serves you better after graduation

Think forward to when you graduate. This is the time when you will want to think about buying a new car, maybe moving to a new city to pursue a new job and maybe even buying your first property. You will want to be viewed attractively by lenders as you will more than likely need a generous credit line.

Entry-level jobs and unpaid internships require generous lenders to supplement your income

The need for affordable post-college credit is especially the case if your first post-graduation job is on an entry level salary or unpaid internship. If you have 3 – 4 years of good credit conduct in your credit files, banks and lenders will be more than willing to extend you competitively rated graduate loans, overdrafts and low-interest credit cards to help you bankroll your graduate life.

Stand on your own feet

The feeling of freedom you experience during college is matched only by the feeling of financial independence you will hopefully feel once you graduate and find your feet financially. If you have been fortunate enough to receive a generous amount of assistance from your parents during your studies, you will feel must more accomplished and autonomous if you can rely on your own strong credit score after college, rather than ask your parents to bankroll you or co-sign a loan.

What you can do

While you are in college, get those good fiscal habits locked down. You should:

  • Always repay your credit card bills on time and in full each month
  • Only use credit cards for emergencies
  • Seek out lower interest store cards with limited purpose and use those modestly, repaying in full every month
  • Have your utility bills deducted automatically from your bank account each month
  • Do not fall behind or default on bills
  • Check your credit report for errors twice a year
  • Compare leading lending companies if you need extra personal financial assistance.



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