Building your credit: Intro
Building your credit is important if you ever need to get a mortgage, car loan, or even a lower interest rate on a student loan. The only way to build your credit is to use it, but it can be hard to find a credit card that will accept you without any credit history.
One credit card that tends to approve newcomers to credit (especially students), is the Discover It Student card. This card offers 5% back in rotating categories, and 1% back on everything else. At the end of the first year, all of this cashback is doubled, so it equates to 10% back in rotating categories and 2% back on everything else in rotating categories. It has no annual fee, so you can keep it forever.
When applying for a credit card, you’ll need to get some basic information together to submit the application. You’ll need a US physical address (not a PO box), Social Security Number, and your total annual income in addition to basic information such as your name and address. For this specific credit card, using your .edu email address tends to speed the process up to get approved. Because it’s likely your first credit card and you have no other credit history, Discover may ask for proof of address, social security number, and student status to process the application.
Once you get approved for the Discover credit card and you receive it in the mail, the most important thing to do is add your bank account for online payments and set up automatic payments for at least the minimum payment out of your checking account. To avoid interest, you’ll want to set up automatic payments for the full statement balance. This means all your purchases for the statement period will be batched up and pulled from your checking account each month, and you’ll never pay a penny in interest.
You’ll also want to keep track of your credit report once you start building credit. Experian CreditWorksSM is a great tool for that, and you can click below and sign up for a 7-day trial to view your credit report for $1. After 7 days, it will automatically bill at full price every month.
Advertiser Disclosure: SK Affiliates LLC will receive a commission from Experian when you sign up with the link above. SK Affiliates LLC is not owned by Experian, and none of the content on this site has been approved or endorsed by Experian. Experian CreditWorksSM is offered by Experian.