Tips on establishing credit the right way

CHICOPEE, Mass. (WWLP) – In a world where plastic is becoming more popular, and credit cards more accessible, it only takes a few mistakes for young adults to find themselves in trouble.

Young adults who plan to buy or rent a home, start a business, pay for a car, or even land certain jobs need good credit. It lets lenders know whether they should give you money. Building credit requires establishing a good payment history and that can be hard for young people without experience.

Kim Beebe, the Associate Dean of Retention at AIC, told 22News, “When students go away from their parents and have this new sense of freedom, they want to explore things on their own. What they do now will affect them not only a week down the line but five to 10 years down the line as well.”

First off, not all credit cards are the same. Look for one with low interest rates, no annual fees, and clear billing policies. Use the card to pay for small, occasional purchases, and try your best to pay it off in full each month so you don’t drown in debt.

Adam Brunet of Springfield  said, “To start off with a burden where your income is not your own but belongs to someone else, or a fraction of it, that can be tricky and hard to deal with when you’re starting out.”

Cheyenne Howard of New Bedford told 22News she became an authorized user on her parent’s card to build credit. The college junior said, “She’s always like be careful and don’t buy things you don’t need. I try to minimize it as much as possible and limit my budget.”

It’s easy to check your credit score for free. The National Foundation for Credit Counseling says a good score is usually above 730, and a bad score below 650.