Let’s face it, many students don’t have to worry about paying for health insurance, making rent and utilities, while saving for retirement. But now that graduation has come and passed, students are out in the real world, facing real world issues—like credit.
Lesson 1: There is a price to pay for using credit…and if you start unwisely, that can be a pretty high price. For students starting out, gently build your credit score by paying off your credit bill each month rather than racking up a bill debt of luxury items you don’t need.
Lesson 2: Understand what your credit score means.
720+ Excellent
675-719 Good
620-674 Below Average
Under 620 Sub-prime
If you fall into the “sub-prime” category, chances are you will have a harder time finder a lender, and once you do, you will probably be paying a higher interest rate.
Lesson 3: Request a copy of your credit report. You are just starting out, so find out what your credit report already has on it. If you have a credit card, or a student loan, that will be reflected on the report.
And to sum up the best advice you can get at this stage, don’t spend more than you are making, and set up a savings account. Do all of the above, and you are on your way to succeeding in the real world. ■
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