Three things to know when building and maintaining credit

Rebecca Gramuglia

Special to the Village News

March marks National Credit Education Month. When was the last time you pulled your credit report?

Well, according to a recent study from Consumer Reports, you may find at least one error (reported by more than one-third of participants) alongside errors with your personal information (reported by nearly 30% of participants).

And according to a recent survey from TopCashback.com, 58% of Americans prefer to use a credit card when shopping.

The latter survey polled a cross-section of 2,024 adults, aged 18 and over.

People prefer plastic

Which of the following do you own? [select all that apply]

• Checking account (88%)

• Debit card (86%)

• Credit card (83%)

• Savings account (74%)

• None of the above (2%)

Do you pay off your credit card in full every month?

• Yes (66%)

• Sometimes (22%)

• No (12%)

Out of the following choices, which is your preferred payment method?

• Credit card (58%)

• Debit card (33%)

• Cash (8%)

• Writing a check (1%)

To help keep your credit in check, here are three tips.

1. Be on time. A big factor in improving your credit score is paying your bills on time, even if you can only pay the minimum balance. By doing so, you can be seen as a responsible lender and therefore, gain access to loans for buying a car, home and more.

Pro-tip: If you can, make it a habit to always pay off your credit card in full each month. Not only will this save you the stress of racking up debt, but it will also help you avoid additional interest on the total balance due.

2. Check your credit report. Regularly reviewing your credit report is key to making sure all of your hard work is paying off. You can request a free copy of your credit report from one of the nationwide credit reporting companies (Equifax, Experian and Transunion). Compare your own records to the reports and be sure to verify that all the info listed is accurate since this is what will be available to creditors, insurers and employers. Any hiccups can affect whether you get a loan or a job, and the report can show any signs of fraud. If something is off or missing, file a written report of the inaccuracy to a credit reporting company as well as the initial information provider.

3. Pass on the knowledge. The longer you have a credit card, the better. And if you have kids, it’s important to teach them how to build credit as early as possible. While they must be 18 to open their own account, your credit card program(s) may allow you to add your child as an authorized user when they are as young as 13.

Pro-tip: When you think your child is at the appropriate age, sit them down and explain your credit card statement and credit report. This will be beneficial when they eventually begin managing their own finances.

Rebecca Gramuglia, consumer expert at TopCashback.com.