College Students: How to Build Credit Without Building Debt

Many college students want to start building credit but when many do, the debt starts to build as well. With little money coming in to actually pay off a credit card, students need to be careful not to spend more than they can realistically afford. While I am in no way an expert, I have experience this myself and can give a little bit of advice just having gone through the credit-building process.

1) Always pay off your bill each month.

If you aren’t rolling in the dough, you shouldn’t charge everything on your credit card (as this can cause you to overcharge, believing you’ll be able to pay the bill when you can’t) but you should just charge a little each month and then pay it off. You’re looking to build credit, not debt! This shows that you’re a responsible borrower and are trustworthy when a lender is considering giving you a loan or line of credit.

Another plus to paying off your credit card each month is not having to pay interest. Because you’re looking to build credit, the interest rate on your card is probably really high. You don’t want to pay extra because you forgot to pay off your bill.


2) Get a credit card with no fee.

Many cards charge fees because of the rewards program they provide, for the prestige, or for some other silly reason. You don’t need any of these cards. You can find plenty of credit cards for students that allow you to build credit with no fee as long as you pay your bill on time. Look through Bank of America, CitiBank, etc. to see which has the best card to help you build credit. One of the best options I found to help me build credit was the mtvU credit card, which also enrolls you in the ThankYou network. The ThankYou network allows you to redeem points you earn on purchases to help pay off student loans or for gift cards, etc.

3) Look for cards specifically for students.

While I mentioned this above, you should always be looking for cards that are made to help students build credit. It will be easier for you to get one of these cards because the company knows that you won’t have established credit and are looking to build credit for the first time. This also means that your interest rate will be higher which just strengthens the point I made in #1. Make sure you pay off your bill! When you graduate, you’ll have enough debt from your student loans – you don’t want credit card debt as well!