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Building and Maintaining Good Credit

            One of the most important factors of becoming successful in life is building and maintaining a good credit rating. Very expensive items may be difficult, or impossible, to obtain during life if the purchase price needs to be paid in advance before taking possession of an item. Banks, and other financial institutions, grant loans to well-qualified buyers. This allows the purchaser to make monthly payments on high dollar items. This is an example of why forming, and preserving stellar credit is beneficial.
             It is important to begin establishing credit by forming a financial relationship with a reputable bank. Opening a checking and savings account is the first step to learning financial responsibility, and balancing monetary means. A bank account can be opened at any age, but a parent will need to be assigned to the account if a person is under 18 years old. Keep track of deposits and withdrawals. Doing so will which what money was spent, and where it has been spent at.
             At age 18, when a person is considered a legal adult, it is important to obtain a credit card from a trustworthy company. It can be problematic to find an acceptable credit card offer that offers low-interest rates for new borrowers without any credit history. That is why the interest rates are usually higher when first establishing credit. There are some credit card companies that offer lower interest rates for students. However, some people may not be aware of this, which causes the person to pay higher interest rates. Researching and comparing different card options is the smartest way to go when applying for a credit card. Charge only what is minimally needed on the card, and pay the entire balance each month as this quickly shows financial responsibility to future lenders. Never charge the maximum available credit on the card. A credit card appears as a revolving credit line on a credit report, and the company will report the payment history to the credit reporting agencies.

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