In college, when I wanted to buy something, I’d either use my debit card or cash. As someone who’s always traveled a lot, the biggest issue always came when I’d try to rent a car. They wouldn’t accept debit cards and would deny me rental access because I didn’t have a credit card. It was really embarrassing. I wanted to get a credit card, but I was scared that I wouldn’t get approved. I didn’t think I had any credit. I quickly found out, that I was right. I walked right into the bank, eager to get a credit card and feel like an adult. I was immediately declined. How frustrating!
I went to my bank, Wells Fargo (Wachovia at the time), and asked for help. A banker at Wells Fargo asked me if I had one thousand dollars. He told me that if I put down that money, he could get me a credit card with a line of credit worth that amount. He said eventually, I’d get that money back. I was nervous, one thousand dollars was a lot of money for me. I hardly made anything at work. Hesitantly, I withdrew the money and handed it over to the bank. And that was how I got my first credit card.
My goal with this new card was to build credit. I was told the best thing to do was to charge everything to the card and pay everything owed off in full. Luckily, I had a credit limit of only $1,000 so I couldn’t get into too much trouble with the charges. Only a few months later, I applied for an American Airlines credit card, a second credit card. I wanted the additional credit card to help boost my credit score – and the airplane miles! I assumed I’d be declined and embarrassed – once again. When I saw I was actually approved, my face lit up! I felt like such a grown up! I started paying for bills with the card immediately.
A few years later, I decided to lease a car. This was a financial decision that was helpful for my business and my credit score. For the full term of my lease, I paid everything on time. I just finished that lease and was stoked to see my credit score hit nearly perfect!
To summarize my money story, I had no idea what my credit looked like after college. Please don’t make this mistake, educate yourself and use tools to find out your credit score early on. By putting down money and securing a credit line, I was able to get my first credit card. I built my credit score by making purchases on my credit card, paying my balance off on time and in full each month, getting a second credit card, and eventually leasing a vehicle and paying that balance in full each month.
When it comes to your credit score, educate yourself. Make sure you know what it is and start taking the necessary steps to build it up and to avoid “credit fumble” which describes the avoidable financial mistakes 7 out of 10 people make before they turn 30! If you have any questions – I’m here for you and so are our partners at Credit Karma.
I’d love to hear your money story and how you got your credit score and finances on track – it’s so important to share! Please leave your comments below and hashtag everything #MyMoneyStory.
This blog is sponsored by Credit Karma.