How to build credit history?

For people who are new to credit and trying to build a history there are many different options. It’s important to pay close attention because it can be easy to lose your way.

  • • Apply for and open a new credit card. You may receive good terms or you may have a high APR, because you do not have a credit history. It’s possible that it maybe difficult to find a credit card to approve you due to your lack of history. If this is your situation you can look into a secured credit card.
  • • Open a secured credit card. This can help you establish your credit history if you are unable to go the tradition credit card route. This type of card requires you to deposit money with the credit card company. After that you can make charges on the card up to the amount you have deposited. This is often a good option because secured credit cards do not often turn applicants down. Pay attention to terms and fees as they may be high due to your lack of history.

No matter if you decide on a traditional credit card or a secured credit card, it’s integral that you keep low balances, make a payment each month, and never miss a payment. You will be on your way to a great credit history.

Will spending less money and putting more into savings improve my credit score?

Even though putting money aside in savings is a great idea, it won’t necessary have any impact on your credit score. Credit scores don’t recognize the amount of disposable cash you have on hand. The amount you have in savings doesn’t have an impact on your score.

Spending less can have an effect on your credit score, but only in terms of spending less on credit cards will it have a positive impact on your credit score. If you spend less on your credit cards then your balances will start to lower. This will effect your credit score positively.