What is the real deal on establishing good credit? What does it take? What does it really mean? How do you begin? This slide offers some of the guiding principle of getting started.
The key is to start and not rush into anything. Once ready, it is advisable to open a checking and savings account. Shop around for free or low-cost checking account options.
Most banks and credit unions also offer credit cards. Review interest rates and fees carefully. Do not be turned by low introductory rates, only to find that the rate goes up dramatically in a few months. Be sure to ask the credit card issuer if they report how you pay to a credit reporting agency. If they do not, you cannot establish credit using the card, even if you pay it off every month.
In most cases, one or two credit cards, used wisely, should suffice. Do not charge the limit of one card. It is better to charge less on both cards with room to spare.
Do not charge more than you can afford and get in the habit of paying off the card in full every month. Make absolutely certain that your payments are made on time!
