How to Build Credit When You Turn 18

A secured credit card is a good starting point if you have no credit history.

A secured credit card is a good starting point if you have no credit history.

Building credit is something of a Catch-22 when you are turning 18. Obviously, you haven't had much of a chance to create a credit history before becoming an adult, yet your credit history is one of the factors that determine whether anyone will give you credit. Despite this difficulty, you can use several strategies to start building your credit. Beginning slowly with small amounts and honoring your commitments for paying back what you borrow will create a firm foundation on which you can continue building your credit in the years to come.

Getting Credit

Open a checking account at a bank or credit union if you don't have one already. You will need a checking account to pay your bills once you get credit. Bank accounts are listed on your credit report and will help you establish a credit history.

Apply for a gasoline or department store credit card. These are usually easier to get than major credit cards such as Visa and MasterCard because they are less risky for the company issuing them and have lower credit limits. You can then build your credit while purchasing things you would normally buy anyway.

Purchase something at a local retail or department store using a large down payment and making regular monthly payments on the balance. Be certain the store will report your payments to a credit reporting agency, otherwise it will not help build your credit history.

Apply for a small loan at the bank or credit union where you have your bank account or where your parents have their bank accounts. You are more likely to get a loan if the people there know you or your family. Ask your parents to co-sign a small loan if the bank is unwilling to give you the loan on your own.

Apply for a secured credit card at your bank or credit union. After giving the bank a secure deposit, you will be given a credit card for that same amount. The bank keeps the deposit as a guarantee against the card should you default on your payments.

Building Credit

Use your credit card only for essential purchases, and don't charge more than you can afford to pay back. Letting your card reach the maximum credit limit will hurt your credit score.

Pay your bills on time each month for at least the minimum payment. Missing a payment or failing to pay the minimum required will hurt your credit score. If you can't pay off the card completely, stop using it until you have paid the balance in full to avoid interest charges.

Apply for a major credit card after you have had a bank loan, gas card or department store credit card for at least six months. If you are declined, wait a couple months and apply for a different card.


  • Prepaid credit cards can be convenient for things such as online purchases but are not the same as secured credit cards. They don't help build a credit rating.
  • You can get a free copy of your credit report once each year from Your credit report will show your credit history, including major credit transactions and the standing of your account or accounts. You can use this information to correct or dispute incorrect entries as well as to guard against identity theft. Read the FAQs on the website for more information.


  • Apply for only one or two credit cards at a time. Applying for too many credit cards can lower your credit score because each card you accumulate counts against your total available credit.Creditors also are skeptical of anyone who suddenly starts applying for several cards all at once. They might suspect identity fraud, for example.

About the Author

A published author and professional speaker, David Weedmark has advised businesses and governments on technology, media and marketing for more than 20 years. He has taught computer science at Algonquin College, has started three successful businesses, and has written hundreds of articles for newspapers and magazines throughout Canada and the United States.

Photo Credits

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