Dinero Teens: How to Build Credit Without Wrecking It

As a teenager thinking about the future (college, your first apartment, or even getting a phone plan in your name), credit might already be on your radar; if it’s not—no worries because now’s the perfect time to learn how to build credit correctly.

What Even Is Credit?

Credit is basically your financial trust score. It tells banks, landlords, and other companies how likely you are to pay them back. The better your score, the easier it is to get a loan, rent an apartment, or even get a job in some industries. Your credit score is based on how you handle things like credit cards, loans, and bills over time.

How to Start Building Credit

1. Become an Authorized User

Ask your parent or guardian if they’re open to adding you as an authorized user on their credit card. You’ll get a card with your name, but the main account holder is still responsible for payments. If they have good credit habits, that can give your score a head start.

2. Get a Student or Secured Credit Card

If you’re 18, you can apply for a credit card in your name (you might need a cosigner if you don’t have income yet). A student credit card or secured credit card is designed for beginners with no credit history.

Just remember: this is not free money—it’s a tool. Use it for small purchases like gas or streaming services, then pay it off in full every month.

3. Keep Your Balances Low

Let’s say you get a card with a $500 limit. Don’t use all of it. Try to stay below 30% of your limit (that’s $150 in this case). Using too much of your available credit can lower your score, even if you pay it off later.

4. Pay ON TIME—Every Time

Your payment history is the biggest factor in your credit score. Set reminders, use autopay, or do whatever works for you to never miss a payment.

Late payments stay on your credit report for up to 7 years—yikes.

5. Be Patient and Consistent

Credit doesn’t build overnight. It’s like planting a tree: water it with good habits, and in a few years, it’ll grow into something really valuable. Don’t rush it. Don’t open five cards at once. Just be consistent.

What Not to Do

• Don’t open cards just for the freebies or discounts.
• Don’t max out your card, thinking you’ll pay it off later.
• Don’t let your card sit with a balance and forget about it.

Starting young gives you a major advantage. Credit might seem like a boring adult thing, but it’s actually a tool that helps open doors for your future. The earlier you learn to use it wisely, the more freedom you’ll have down the line.