Got Credit? Here’s How to Get Started Building It Today

March 11, 2021

If you are wondering ‘why do I need credit?’ here’s why: If someday you’d like to purchase a car, a home, or even rent an apartment, you’ll need credit. If you are new to credit, here are some ways to build it.

Saving to stay out of debt is good financial practice. But at some point, you may want to make a larger purchase, and you’ll discover it’s better to have credit and not need it, than to need it and not have it. 
How to build credit
Start building credit by opening a credit card, such as a gas credit card or a universal Visa credit card. Once you have opened your card, use it sparingly, and be sure to make all payments on time. 
Your credit usage will impact your credit score, which is a number between 300 and 850 assigned to you based on the likelihood of you paying back a loan on time. The higher the number, the better your score, and the more favorable the interest rates you will qualify for, saving you money.
Factors that make up your credit score include:
  • Bill-paying history
  • Amount of unpaid debt
  • How many and type of loan accounts you have (including credit cards)
  • How long you have had your loan accounts
  • How much of your available credit you are using
  • New applications for credit 
Lenders, landlords, and insurance brokers review credit scores to make decisions such as whether to offer you a credit card, auto loan, lease, or an insurance policy.
Making consistent, timely payments on what you owe is the most important part of building credit. You will be establishing a credit history, too, which is a record of how you’ve managed the repayment of debts, such as credit cards and loans.
Be aware: you do not need to carry a balance on a credit card to build credit. It will reflect well on your credit score and credit history if you use your credit and pay at least the minimum balance or pay it in full each month. However, carrying a high balance on your credit card is more likely to reduce your credit score, not improve it.
To help college students with the knowledge they need to establish good credit, MSUFCU offers financial education, and the lowest interest rate on an MSUFCU Platinum Plus Visa Credit Card, even if they don't have credit established. 
With this card, students receive 1% cash back on all purchases. Plus, there's no annual fee and no international service fees. For more information, visit

Tags: Learn About Credit, Borrowing Money, Credit Cards