topic Re: 18 Year Old Credit Help in General Credit Topics

18 Year Old Credit Help

rwesleys — Wed, 11 May 2016 02:11:02 GMT

Hi everyone!

I turned 18 around 8 months ago and I want to build my credit. I've currently got 4 cards: Amazon Store Card [$800], BofA Cash Rewards Visa [$500], Cap 1 QS [$500], Cap1 Secured [$450], Kohls Store Card [$300], Discover Secured [$200]. Though I have built my credit history in the past 8 months, I've also acquired 15 inquires. Not good. I don't owe anything on any of the cards currently, and have never missed any payments.

I wanted to come on here and just seek advice. I want to build my score and ultimately my financial future. I believe I have great self control when it comes to spending, but it's been hard for me to not apply for cards I think I could get.

My current scores are as follows: [UPDATED: Just signed up for MyFico.com's reporting tool and my scores are much higher than I thought.]

EQ: 600

TU: 642

EX: 620

I want to know what you would suggest for someone in my situation. Obviously, stop applying for cards. But in the next 6-12 months, what are my options?

Thanks! I love the community on here.

Re: 18 Year Old Credit Help

RonM21 — Wed, 11 May 2016 02:48:34 GMT

The first thing that comes to mind is outright growing the cards. Putting spend on them wisely, paying in full, and only letting one card report a small balance below 10% then paying off.

Doing this should eventually increase your limits, opening the door for other things.

Do you have anything else reporting other than Credit cards?

Re: 18 Year Old Credit Help

rwesleys — Wed, 11 May 2016 02:57:46 GMT

I don't have anything right now besides my cards.

Re: 18 Year Old Credit Help

Anonymous — Wed, 11 May 2016 03:29:41 GMT

@RM21 wrote:
The first thing that comes to mind is outright growing the cards. Putting spend on them wisely, paying in full, and only letting one card report a small balance below 10% then paying off.

Doing this should eventually increase your limits, opening the door for other things.

Do you have anything else reporting other than Credit cards?

I agree. This is called gardening, and is what you need to do. Don't apply for anything else right now. Garden for a few months and then go for a Chase card. I see you have 6 cards, so you are already 1 card over their 5/24 rule, but you may still have a shot with them if you don't apply for anything else in the meantime.

Edit: How long have you had your current cards?

Re: 18 Year Old Credit Help

rwesleys — Wed, 11 May 2016 03:32:19 GMT

@Anonymous wrote:
@RM21 wrote:
The first thing that comes to mind is outright growing the cards. Putting spend on them wisely, paying in full, and only letting one card report a small balance below 10% then paying off.

Doing this should eventually increase your limits, opening the door for other things.

Do you have anything else reporting other than Credit cards?
I agree. This is called gardening, and is what you need to do. Don't apply for anything else right now. Garden for a few months and then go for a Chase card. I see you have 6 cards, so you are already 1 card over their 5/24 rule, but you may still have a shot with them if you don't apply for anything else in the meantime.

Edit: How long have you had your current cards?

Thank you both for your insight.

The longest card I've had is my Cap1 Secured and it's only 8 months old. It's been paid on time every month and in full.

Re: 18 Year Old Credit Help

Anonymous — Wed, 11 May 2016 03:43:53 GMT

@rwesleys wrote:

@Anonymous wrote:
@RM21 wrote:
The first thing that comes to mind is outright growing the cards. Putting spend on them wisely, paying in full, and only letting one card report a small balance below 10% then paying off.

Doing this should eventually increase your limits, opening the door for other things.

Do you have anything else reporting other than Credit cards?
I agree. This is called gardening, and is what you need to do. Don't apply for anything else right now. Garden for a few months and then go for a Chase card. I see you have 6 cards, so you are already 1 card over their 5/24 rule, but you may still have a shot with them if you don't apply for anything else in the meantime.

Edit: How long have you had your current cards?
Thank you both for your insight.

The longest card I've had is my Cap1 Secured and it's only 8 months old. It's been paid on time every month and in full.

Once your oldest card hits 1 year you'll be in a much better position to try for another card, even better if you can wait until they all hit 1 year

Re: 18 Year Old Credit Help

rwesleys — Wed, 11 May 2016 03:54:15 GMT

@Anonymous wrote:
@rwesleys wrote:

@Anonymous wrote:
@RM21 wrote:
The first thing that comes to mind is outright growing the cards. Putting spend on them wisely, paying in full, and only letting one card report a small balance below 10% then paying off.

Doing this should eventually increase your limits, opening the door for other things.

Do you have anything else reporting other than Credit cards?
I agree. This is called gardening, and is what you need to do. Don't apply for anything else right now. Garden for a few months and then go for a Chase card. I see you have 6 cards, so you are already 1 card over their 5/24 rule, but you may still have a shot with them if you don't apply for anything else in the meantime.

Edit: How long have you had your current cards?
Thank you both for your insight.

The longest card I've had is my Cap1 Secured and it's only 8 months old. It's been paid on time every month and in full.
Once your oldest card hits 1 year you'll be in a much better position to try for another card, even better if you can wait until they all hit 1 year

Makes since. Thank you so much!

Re: 18 Year Old Credit Help

Anonymous — Wed, 11 May 2016 20:07:03 GMT

Do you have any installment loans? Car loan or student loans?

If not, I'd close out that Capital 1 secured card and open up a secured installment loan with Alliant. There's a method to doing this that's discussed at great lengths on the forum. If you already have an installment loan, then never mind this......

Re: 18 Year Old Credit Help

Kevin86475391 — Thu, 12 May 2016 01:02:56 GMT

@Anonymous wrote:
Do you have any installment loans? Car loan or student loans?

If not, I'd close out that Capital 1 secured card and open up a secured installment loan with Alliant. There's a method to doing this that's discussed at great lengths on the forum. If you already have an installment loan, then never mind this......

This is that thread if you're interested:

http://ficoforums.myfico.com/t5/Understanding-FICO-Scoring/Adding-an-installment-loan-the-Share-Secure-technique/td-p/4506756

I personally don't think it's necessary at this point though. It may help somewhat if you don't already have an installment loan account, but it's really not crucial IMO. I think the most important thing you can do at this point is just sit tight and let stuff age up. Gradually focus on increasing your credit limits through the use of SP (soft pull) CLIs (credit limit increases) and strategic HP (hard pull) CLIs when necessary.

You've done great with making timely payments and it's awesome that you're paying your cards in full every month! Way to go! The main thing holding you back at this point is just that your credit history is new. My advice would be to continue PIFing (paying in full) on time every month, but beyond that try not to even think about credit for the next 6-12 months so that you're not tempted to apply for anything else. Just put your cards in your wallet and forget it. You may see some lender-initiated CLIs, but even if you don't that's okay. You can take the SP and strategic HP route to CLIs that I mentioned above in about a year or so after your credit profile has aged up. You're doing great but credit is a marathon and not a spint, so my advice is to just slow down and pace yourself. You'll get where you need to be just by hanging in there with the timely payments and waiting for your accounts to get older.

Re: 18 Year Old Credit Help

Berk — Thu, 12 May 2016 16:43:09 GMT

@rwesleys wrote:
I've currently got 4 cards: Amazon Store Card [$800], BofA Cash Rewards Visa [$500], Cap 1 QS [$500], Cap1 Secured [$450], Kohls Store Card [$300], Discover Secured [$200]. Though I have built my credit history in the past 8 months, I've also acquired 15 inquires. Not good. I don't owe anything on any of the cards currently, and have never missed any payments.

I wanted to come on here and just seek advice. I want to build my score and ultimately my financial future. I believe I have great self control when it comes to spending, but it's been hard for me to not apply for cards I think I could get.

My current scores are as follows: [UPDATED: Just signed up for MyFico.com's reporting tool and my scores are much higher than I thought.]

EQ: 600
TU: 642
EX: 620

I want to know what you would suggest for someone in my situation. Obviously, stop applying for cards. But in the next 6-12 months, what are my options?

Thanks! I love the community on here.

I count 6 cards.

With that being said, time is your biggest friend right now. As your income grows your credit lines will grow. I also am not a big fan of store cards even though I have 4 myself. You are well on your way with the cards you have now. Just grow the limits and have fun!

Re: 18 Year Old Credit Help

Anonymous — Thu, 12 May 2016 19:34:05 GMT

@rwesleys wrote:
Hi everyone!

I turned 18 around 8 months ago and I want to build my credit. I've currently got 4 cards: Amazon Store Card [$800], BofA Cash Rewards Visa [$500], Cap 1 QS [$500], Cap1 Secured [$450], Kohls Store Card [$300], Discover Secured [$200]. Though I have built my credit history in the past 8 months, I've also acquired 15 inquires. Not good. I don't owe anything on any of the cards currently, and have never missed any payments.

I wanted to come on here and just seek advice. I want to build my score and ultimately my financial future. I believe I have great self control when it comes to spending, but it's been hard for me to not apply for cards I think I could get.

My current scores are as follows: [UPDATED: Just signed up for MyFico.com's reporting tool and my scores are much higher than I thought.]

EQ: 600
TU: 642
EX: 620

I want to know what you would suggest for someone in my situation. Obviously, stop applying for cards. But in the next 6-12 months, what are my options?

Thanks! I love the community on here.

Welcome.

That is 6 cards I count, 3 cards too many for your age IMO but hey if you have the income have at it. Do you have any installment loans reporting as well?

If you want to grow your cards, you should be gardening now and not making any more Inquiries. In the future(think multiple years from now, either post-grad or when your obligations increase) you should be looking toward expanding to other CCs, such as AMEX or Discover or Citi.

Also, I was 18 not that long ago. I know how tempting it is to use that shiny plastic card to buy stuff for friends and take them out to eat and go to concerts, but really consider how you plan to pay it back if you're unemployed. Don't make any financial decisions on those cards unless you can afford to. I can't stress that enough.

Otherwise, you're ahead of the curve. Just use it as a replacement for cash and pay it off at the end of the month. Enjoy your Cash Back and as you get older and acquire more income, you can ask for CLI's and grow your credit lines.

Re: 18 Year Old Credit Help

jamie123 — Fri, 13 May 2016 01:52:18 GMT

Like others have said before me, time is your friend. Don't apply for any new credit at least until your oldest card is 1 year old.

Don't get any more store cards. You have an AWESOME starting line up of bank cards for your age! Make sure that you take good care of the bank cards and keep them open for life. Those cards would be your Bank of America, Discover and Cap 1 QS. The Amazon store card is not too bad either.

I would actually suggest waiting until all your cards are 1 year old and then apping for an AMEX and a Chase Freedom card. You will then be in with all the big banks that will grow with you for life.

Make sure to setup auto payments on all your cards to pay the minimum monthly amount in case you ever forget to make a payment. One late payment could set your credit building back a few years.