Build a Good Credit History

Good Credit Saves Money!

Thanks to a deluge TV and Internet ads, you probably know that your credit score is the key to accessing the loans you may want to help pay for everything from education to a new car to your first home. But why exactly does your credit report and score matter so much? And how do you build a good credit history?

Credit Report Basics

There are tons of charlatans out there trying to sell the “secret” to building good credit. Unfortunately, there’s only one secret: pay your bills on time and don’t go into extraneous debt. If you’re starting from scratch, get one or maybe two credit cards, use them occasionally, and pay them in full and on time. In a year or two, you should have a credit history worthy of a bigger auto loan or mortgage. If you need to improve your credit score, work on eliminating debt and, again, paying on time.

Checking Your Personal Credit Report and Score

It’s easy to check your credit report and score for free online; just beware, in order to get this free information on most sites, you’ll have to sign up for a trial of credit monitoring and cancel it within the allotted time frame.

If you want to track your progress as you build a good credit history, you may want to sign up for these services. If so, I’ve put together a comparison of credit monitoring services you may find useful.

For more, browse all articles on credit.