Entering college for the first time is an eye-opening experience for most kids. This is the time when they first taste true freedom and start their young adult life.
This is also where a lot of dumb money mistakes can cause serious trouble in the long run. Conversely, smart money decisions can also lead to a strong credit history in the long run.
Here are two of the smarter money-related things a college student can do while on campus:
Develop conservative spending habits
One of the most important things you can do to build your credit score is to keep your spending in check. This doesn’t mean you should live your life as a miserly old coot. No, all you need to do is make sure that you keep a low balance on your credit card and keep a checking account well stocked with cash – even if the money is your mom’s or dad’s.
These spending habits are what the big credit rating bureaus – Equifax, Experian and TransUnion – will check to determine your score. Spend right and they’ll recognize you as a responsible borrower while pumping up your credit score in the process.
Read and monitor your credit reports
The credit rating agencies are pretty good at what they do, but they’re bound to make mistakes when they process millions of credit-score changes a month. It is for this reason that you have to check your credit report on a regular basis and spot any potential errors in the report.
For example, you may find out that a credit card company reported a payment of yours as late even when you have a receipt showing that you paid on time. It’s dealing errors like these that can make or break your credit score.
One last tip: you’re entitled to free credit report annually from one of the three major credit rating bureaus. And it’s free. It only takes a couple of minutes to view and print your free report. In this way, you’re able to keep tabs on your credit without spending a dime.