How to Build Your Credit Score as a Student

As a consumer, having a good credit score is extremely important. With your credit score, lenders determine if you qualify for a loan such as auto loans, home loans, or even personal loans. Even if you're eligible for a loan, your credit score will dictate the interest rate, borrowing limit, and repayment terms.

Not only lenders but several landlords and employers have started to check their tenants' or employees' credit scores. However, if you're a college student, you may be immune to that kind of scrutiny. It protects you from destroying your credit at a young age, which means you will be building your credit score from scratch.

Let's understand, what is credit, and why is it so important?

What is Credit?

The word credit itself has several meanings; for example, it can mean money in the bank or the credit, which the lender gives an individual that includes the interest.

However, the credit we will talk about today refers to an individual's history of repaying loans. Several factors go into computing your credit: punctuality of payment, available credit, and types of loans, etc.

As a student, you will start building your credit upon the first loan or credit card you take. After opening your account, the financial institution will report the necessary information to credit agencies like TransUnion, Equifax, and Experian (if you're in the US).

However, note that each credit reporting agency has its way of calculating, so your credit score will differ in each one of them.

Credit reports contain a lot of information about yourself regarding your financial status. They include:

  • Current and previous addresses
  • Social Security Number
  • Payment History
  • Public records
  • Debts
  • Credit Accounts
  • Companies and lenders

Always remember that as a consumer, you have the right to scrutinize the information in your credit report and make sure that it's error-free. When you notice a mistake, you can contact the credit reporting agency and appeal. But besides all of that, it can be a real struggle to build your credit from scratch.

Here are some tips for building your credit from scratch as a student.

Become an Authorized User

Becoming an authorized user on someone's credit card is a good tactic if you want to build your credit. As an authorized user of that account, you can also take out loans and make purchases as if it's your own, only if permitted by the user.

If you want to be an authorized user, you can ask your friend or parents to share a credit card with you. The only thing they have to do is to add your name to the authorized user list, and you're good to go.

After that, you'll receive a credit card attached to the account, which you can use for most features. You don't have the full privileges of the main user, but it's still enough to build your credit. Some examples of the things you can't do are changing the information on the account, adding more authorized users, and requesting a credit increase.

Open a Credit Card Account

One of the most common and straightforward ways to build credit as a student is to open up a credit card account. It's easy if you have a side job because you'll be able to show proof of income. You can be an authorized user of one of your parent's credit cards, but it's more thrilling to maintain one for yourself.

One thing you can do is to get a secured account. It's called secured because the account is secured by the amount of money you deposit into the account. Some cards go as low as $200 to $300, which is a great deal if you have extra savings.

One of the reasons why a secured card is a good option for students is that it limits the risks of both the lender and user, and at the same time, the consumer has to stay within their limits. If you prove to be a responsible account holder who pays their monthly dues before or on time, you can ask for an unsecured card.

Another way you can open a credit card is to have a cosigner. However, if you’re confused if you should get a cosigner or not since you already have a reliable source of income that credit card issuers could check, it’s better that you shouldn’t.


As a student, it will be a struggle to build your own credit since you're not that easily approved for loans and make a credit card account. It becomes even more difficult if you don't have any proof of income. However, with some creativity and a little help, you can start building your credit using the methods mentioned above.