How to Build Your Credit for High School Kids

by Kelly Gear ; Updated July 27, 2017
Establish your good credit now.

Items you will need

  • Job/income
  • Secure credit card
  • Parent's authorization

Building credit is the foundation to establishing a secure financial future, for all teens and young adults. Starting early is not only wise, but also essential, if you want to to have a good, solid credit history, ensuring that you'll get the lowest interest rates, which will save you thousands of dollars in the long run when you're ready to make those large investments, such as buying a home or getting a business loan. There's no greater time than now, while you're still living at home with your parents, to build credit and guarantee future success in the financial market.

Step 1

Find a job or a consistent source of income. This is crucial. You can't learn proper money management or financial responsibility without having your own source of income. Consider getting a part time job or find some other constructive means to produce a cash flow.

Step 2

Ask your parents to add you to their credit account as an "authorized user." This will help raise your credit score almost instantly, without you having to actually climb the credit ladder yourself, all while reaping the benefits of your parents' excellent credit history. When you reach the age of 18, you will be able to obtain a credit card, under your own name, with good credit history already established.

Step 3

Open a secured credit card account, with a reputable financial institution. A secured account is a savings account with a bank or credit union that allows the account holder to obtain a credit card, while the bank holds the funds for security. The card limit is equal to the amount of your account balance. For instance, if you have $500 in your account, your credit limit will be for that same amount. Once financial responsibility has been proved, by making timely payments, usually within 12 months, the bank will convert your account to unsecured, return the deposit and in some cases raise your credit limit.

Tips

  • Credit cards are excellent tools to help build credit for high school students. If used wisely, they can give you the edge you need to be a successful young adult, by helping you understand money management and responsibility.

Warnings

  • It is imperative to understand how to properly use credit cards as tools and not crutches. Remember, credit cards are borrowed money that must be paid back, with interest. Try to avoid missing or making late payments. Also beware of all aspects and consequences of the credit world, both good and bad.

About the Author

Based in St. Louis, Mo., Kelly Gear has been writing professionally for various websites since 2008. Gear has published informational articles on a wide variety of topics relating to business, finance, beauty, fashion, fitness, family and more. She holds a Bachelor of Science in business administration from Harris-Stowe State University.

Photo Credits

  • a man with money and a credit card image by Sergii Shalimov from Fotolia.com