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Why Your Credit Is Important + Tips On How To Build It

My mom always says that, in the U.S., without credit you are no one. That sounds pretty harsh but having good credit is key for adulting.

You need good credit in order to buy a home, car and other major items. Your credit determines your interest rates on house mortgages, car payments, and loans. Good credit is an indication that you are responsible with your finances and can be trusted to make payments. Even renting an apartment requires a good credit score. Auto insurance and cell phone companies can sometimes take your credit score into consideration.

A credit score can range from 300 to 850. 300 to 579 is considered very poor, 580 to 639 poor, 640 to 699 fair, 700 to 749 good, and 750 to 850 excellent. It is fairly difficult to build up your credit and credit scores do fluctuate a lot.

Before I give you some tips on how to build your score, you should know what is taken into consideration when calculating your score:

  • Credit card utilization
  • Payment History
  • Derogatory marks
  • Age of credit history
  • Total Accounts
  • Hard inquiries

School never taught me how to build my credit, but I have learned through trial and error. Here are my tips on how to build your credit and keep it in a good stance:

That is all I have picked up on my short credit journey for now. Don’t procrastinate and get that credit score up! 

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Yahaira Garcia
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Yahaira is a second year Psychology & Social Behavior major at UC Irvine. She loves puppies, her family, makeup, food, writing and watching Netflix. She is also very passionate about social issues and learning.

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