How to Build Credit in 6 Steps
On February 25, 2026 By newsroom Topic: Debt Advice
Building credit is essential for accessing better financial opportunities, such as loans, apartments, and more. Here are six actionable steps to establish or improve your credit:
1. Become an Authorized User
- Join a trusted family member's credit card account.
- Benefit from their positive payment history without requiring a credit check.
- You don't need access to the card to build credit.
2. Apply for a Secured Credit Card
- Deposit cash as collateral, typically equal to your credit limit.
- Use the card responsibly to build credit, with the deposit refunded upon account closure.
- Transition to an unsecured credit card after consistent on-time payments.
3. Use a Rent-Reporting Service
- Services like Rental Kharma or RentTrack can report rent payments to credit bureaus.
- Fannie Mae's Positive Rent Payment program assists renters in building credit by reporting positive payment histories.
4. Take Out a Credit-Builder Loan
- Regular payments on a credit-builder loan go into a savings account.
- Your timely payments are reported to credit bureaus, boosting your credit score.
5. Get a Co-Signer
- Apply for a loan or credit card with a co-signer who has good credit.
- Both parties share responsibility; if you miss payments, the co-signer's credit is impacted.
6. Apply for a Student Credit Card
- For college students, these cards don't require prior credit history.
- They often include low fees and limited rewards to help beginners manage credit responsibly.
Best Habits to Build and Maintain Credit
- Pay on Time: Set up autopay to avoid missed payments.
- Borrow Wisely: Don't spend beyond your means.
- Keep Debt Low: Use less than 30% of your credit limit.
- Diversify Debt: Show creditors you can manage different types of loans.
- Avoid Closing Old Accounts: Keep credit cards open to maintain a longer credit history.
- Don't Open Too Many Accounts: Limit new credit applications to avoid lowering your score.
FAQs About Building Credit
- How long does it take to build credit?
- Several months for new credit; fixing bad credit takes longer.
- When should I start building credit?
- As early as 18 (or younger as an authorized user).
- Is no credit history the same as bad credit?
- No. Limited history means you haven't proven creditworthiness yet, not that you're irresponsible.
Bottom Line
Building credit takes time, but starting early and practicing good habits will help you achieve a strong credit score. Over time, you"9ll qualify for better financial products and rewards.
