Q&A: Young adults and building credit using credit cards
Young adults can use credit cards to establish good credit. However, young adults can also endure building poor credit baggage from credit cards. The good news: Even after new banking regulations, making it more difficult for young adults to get credit cards, credit card comparison shopping can locate reasonably priced credit lines, with low max limits, that can help build credit. The key is to use these cards carefully. Make all payments on time, never max out limits, keep a modest outstanding balance (less than 30 percent of maximum), and record consistent, timely payments. These suggestions all work to build up good credit scores. Compare credit cards to find the best credit card rates and terms available to young people. Most important is to build, not destroy, your report. Wonderful credit card rates are less important than getting approved for minimal maximums and then making all payments on time, as agreed. Be wary of enticing credit card deals that appear too good to be true if youre a young person without recorded credit history. When you examine credit card offers, be realistic. Evaluate credit card rates and terms that are reasonable. Only use credit cards that have the potential to enhance your credit report, not necessarily your lifestyle, as a younger person.
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