If you wish to unlock many financial opportunities in life, you need to have good credit right from the start. It takes time to build up a good credit score. However, it paves the way for various advantages like low-interest rates on car loans, credit cards, and other mortgages. In many cases, employers and landlords have been seen checking upon the credit reports of the candidate before even offering a job or approving of a residential application.

Where to start from and what steps to follow to build credit as a starter 

To start building credit, you need to get credit. However, getting credit for the first time could be challenging, but it is not impossible. Here are steps for a starter to follow in order to build up his credit.

With a credit card:

• Apply for a secured credit card that requires a certain amount of security deposit against the credit limit extended to you on approval. This amount gets refunded or adjusted later.
• Get a retail store credit card which offers low credit limits but can be approved easily.
• Request someone to make you an additional or authorized user. However, before doing so, make sure the primary cardholder is in good standing himself and has a good credit score.
• You can get a cosigner, with good credit, for a loan or credit card. This would improve your possibilities of getting approved.
• Always make your payments on time. Payment history plays a pivotal role in building up your credit score in the long run.
• Opt for just one credit card to start with.
• Act responsibly and borrow an amount that you can comfortably and affordably repay each month.
• Try to pay your balances in full every month. In other words, always pay more than the minimum on credit cards.

Without a credit card:

Alternatively, good credit can be built without a credit card too. You can do so by:

• Borrowing out a loan and repaying on time
• The loan could be in the form of a mortgage, a car loan, student loan, or personal loan.
• You can ask your parents for a hand by making you an authorised user on their rewards credit card or by co-signing for you when you apply for your first car loan or student loan.

Building credit responsibly:

Follow these thumb rules when beginning your credit journey

• Avoid paying interest charges on your credit by paying off the entire amount every month
• Make your payments on time, even if it is just the minimum amount that you can afford to pay. Late payments can wreck your credit reports for years.
• Restrict your credit utilisation rate to 30% of the assigned total credit limit to you. This would improve the overall health of your credit in the long run.

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