Build credit with confidence

Credit refers to your ability to borrow money or receive a line of credit, with the promise to repay that money by a set deadline. A credit score, or FICO score, is an indicator of your likelihood to pay back your debt on time.

A history of consistent, on-time payments can help you build a good credit score and indicates to lenders and landlords that you are a good bet to pay your bills on time.

Conversely, a poor credit score could indicate that a borrower isn’t as likely to pay on time.

The main factors that impact your credit score are:

• Payment history (35%) — on-time payments help, late payments hurt your credit.
• Credit utilization ratio (30%) — how much you owe relative to your credit limit. Your goal is to keep how much you owe low.
• Length of credit history (15%) — keeping old accounts open adds length to your credit history.
• Recent credit activity (10%) — applying for new credit accounts can result in a hard inquiry, negatively impacting your credit (usually only temporarily).
• Credit mix (10%) — having different types of credit accounts can help improve credit.

Three major credit bureaus — Equifax, Experian and TransUnion—report on your credit, and each bureau’s score will likely be slightly different. Credit scores generally range from 300 to 850.

So why does all this matter?

• Your credit score is the primary indicator of your financial health and personal reliability. Building credit in college—or as soon as possible—gives you a head start on major financial milestones, like renting your first apartment or buying a car.
• A good credit score is essential in helping you qualify for lower interest rates and better terms on future loans. The earlier you can build your credit score, the better.
• The stronger your credit score, the more trustworthy you seem to banks, landlords, and even employers. With strong credit, you’ll have more options when it comes to financing, renting, purchasing cars, and even setting up utilities.

To start building credit, the first thing you’ll need to do is open a credit account. For most first-timers, this may mean opening a credit card or becoming an authorized user on a family member’s credit card. For others, it can be getting a student loan with a cosigner.

Once you have a line of credit open, you'll want to follow these tips to build your credit:

• Never miss a payment: Whether it's a student loan, credit card, or phone bill, it is crucial to make payments on time to maintain a great credit score.
• Use a student credit card responsibly: Start with a low-limit card and pay it off in full each month.
• Consider early student loan payments: You can make payments on your student loans while you're still in school. This will help establish your credit history while slowly working away debt.
• Keep balances low: Using less than 30% of your available credit shows lenders you're a responsible credit card user.
• Avoid opening too many accounts at once: Finding one credit card that fits your needs as a student is all you need. Even though getting the newest, most talked about credit cards can be tempting, opening multiple cards causes a small dip in your credit score.

Building credit is about building trust—with lenders, landlords, future employers, and yourself. Start small, stay consistent, and you'll be setting yourself up for long-term success.

Ready to get started? Check out the Citizens Amp® Mastercard®.

Credit scores, or FICO scores, generally range from 300 (poor credit) to 850 (excellent credit). Here’s how it breaks down:

• 800-850: Excellent credit
• 740-799: Very good credit
• 739-670: Good, but room for improvement
• 669-580: Credit needs improvement
• 579-300: Poor, most lenders won’t approve a loan with this score range

If you are not sure what you credit score is, find out. You are entitled to one free credit report from each of the three bureaus every 12 months. You can use that report to see your score, ensure accuracy, identify any errors, and spot identity theft.

Building credit is easier than you think!

Setting up alerts—such as when your checking or savings account balance drops below a certain amount, your credit card balance exceeds an amount you set, or your payment due date approaches—can help you stay on track and spend responsibly.

With AutoPay, you'll know your payments will always be submitted on time, an important factor in building credit history.

Learn how to set up alerts on mobile here.

A debit card lets you spend money directly from your checking account. Once that money is gone, you can’t make more purchases unless your account allows overdrafts. Unlike credit cards, using a debit card doesn’t help you build a credit history.

A credit card is a line of credit that you have to pay back. While it may seem like you can spend as much as you want, you’ll need to make sure you can pay everything back with on-time payments if you want to build credit and avoid paying interest on debt.

Here are key differences between the two: