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Your Credit Score at Eighteen

​Even at age 18 you can build a better credit history by using credit cards wisely, paying off the total balances on your credit cards, and paying all of your bills on time.

Your credit report contains all of your personal information, previous addresses, social security number, current and previous employers, and estimated income. It contains detailed information about each credit card account you have ever owned and includes the type of account, the balance owed, and your payment history. Your credit report also contains information on any loans you have ever taken out and based on these factors, you will be given a credit score that determines the interest rate you will have to pay on loans in the future. And even though many teens don’t worry too much about their credit scores because they haven’t lived long enough to rack up a lot of debt yet, when you turn 18, you are completely responsible for everything contained in your credit report.

Your credit report and eventual score tells a lot about how you handle money and the credit reporting agencies supply your information to credit card companies, banks, and other lenders so they can determine if they should loan you money. After you reach the age of 18 and apply for a job, most background checks will often include your credit report. When you are just starting out, credit-reporting agencies will provide a modified version of a credit report called an employment report. An employment report is not a complete credit report, but it will contain information about your credit-payment history to date and employers will often try to draw conclusions about you based on that information.

If you have a bad credit history it can work against you when you seek employment because many employers will use your credit history to judge your level of responsibility and may question your reliability when you can’t pay your bills on time. This means it is very important to build a good credit history, even as an 18-year-old, because a good credit history will also enable you to get loans for things like cars and homes at a better interest rate, and that can save you a lot of money later on in life. Things you can do right now at age 18 to build up your credit history include using credit cards wisely, paying off the total balances on your credit cards, and paying all of your bills on time. If you can do these simple things, you are sure to have an excellent credit score no matter how old you are.

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