building a credit score from scratch

How to Build a Credit Score from Scratch. A guide for 18-year-olds.

About to graduate high school? Recently began college? Want to help your teenage kid?

How can you get credit, when you’ve never had credit before?

If you need advice on fixing bad credit, this isn’t the right guide.

If you don’t have a score, or have never checked your score, this is your step by step JumpStart Guide to build a credit score from scratch.

Step 1:  Before turning 18.

If you are already 18, don’t worry, just proceed to step 2.

Convince someone with a good credit score to add an authorized user card in your name, to their credit card accounts.  This may sound tough, but convince a trusted family member, boss, or neighbor.  They don’t even have to give you the card, and are free to feed it into the shredder as soon as the card arrives, in the mail.

Why?  A major piece of your credit score is credit card age.  An authorized user AMEX card at age 16 can result in a 2 year old credit history on your future credit report at age 18.  In addition to age of accounts, it will help with the number of accounts component of your score.

Minimum age for authorized user cards varies by bank.  Some banks are even known to back-date the card’s history to the age of the original account.  Check some examples in Frequent Miler’s post here.

Step 2:  Avoid Debt. 

Not just bad consumer debt.  Avoid all debt.  College educations are great, but student loan debt can be crippling.  Seriously weigh the benefits of the degree, the debt that will be incurred, and future income potential.  Consider part time jobs, graduating in 3 years, or the 2nd-choice cheaper school to limit debt.  This step helps to build a credit score from scratch and is necessary for general financial health.

Step 3: Credit monitoring account.

Open a free credit monitoring account.  Creditkarma and Discover Scorecard are useful free tools.  If your credit report contains surprises or errors, research the solutions. Fraud and/or errors happen to many people, and need to be fixed.  If necessary, seek professional help.

Step 4:  Checking account with funds.

Open a checking account, and build up an emergency fund.  I’m going to recommend $1000.  A steady balance in your checking account will not help build A credit score from scratch, but it will make you ready for step 5.  Choose a checking account that won’t hit you with any fees.  Online checking accounts or local credit unions may be your best option.  Choose an account that can be conveniently used on your campus.

Step 5: Credit card.

credit card story

Most of our cards.

Apply for your first credit card.  Maybe tell your parents first?  The first approval might be tough, but target no annual fee cards with “student” in the name.  My post evaluating the Discover-it card for Students is here.


You might be filled with excitement when that first card arrives with a 1000$ limit.  This is not access to $1000 in free money.  It is easy access to $1000 of crippling high interest debt.  Review step 2.  Always pay balances in full.  Avoid interest charges and fees. It’s better to have a low credit score with no debt, than a high score and high debt.

Step 6:  Use credit card wisely.

Manage and use the card without incurring interest charges or fees.  Consider using the card a couple times per year, paying the balance in full, and leaving the card at your parent’s home.  Set up alerts ensuring you never miss a payment, and will notice fraudulent use.

If you decide to use the credit card for convenience purchases like gasoline or food, always pay the balance in full each month.  Never buy anything unless you already have funds in your checking account.  Don’t use the card for clothes, alcohol, or restaurants if a credit card will make you tend to spend more.  Credit cards are not your emergency fund.  The checking account with the $1000 from step 4, is your emergency fund.

Step 7: Monitor your credit score.

Set up a routine and use the credit monitoring accounts from step 3 to check your credit score weekly.  Be on the watch for mistakes and suspicious activity.  If you’re a huge PF nerd like me, it may be fun to record the scores in a spreadsheet.

Step 8:  Another credit card?

If your score is stable or even rising, consider opening card another after 3 months.  At this point, try different banks (AMEX, Bank of America, or Capital One), or store cards (Sears, Gap, or Victoria Secret).  Don’t pick stores cards that tempt you.  My son, JumpStart Jack, opened the Victoria Secret card partly because I knew he would never make any purchases, and partly so I could make fun of his pretty pink card.  Jack doesn’t like to go in the store, and has never made a purchase with the card, but it adds an aging account, which helps his credit score.

Step 9: Protect your good name.

Be careful about any accounts your name is associated with.  Apartment leases, electric, and water bills probably won’t help much, but they can negatively affect your score.  An irresponsible room-mate can wreck your credit by forgetting a bill, if your name is on the account.

Step 10: Patience.

Be Patient.  It takes time to build a credit score from scratch. Continue with steps 2, 6, 7, and 9.  Consider repeating step 8 every 3 month to 6 months.

My son JumpStart Jack has been following these steps for close to a year. He is approaching his 19th birthday and making solid progress.  JS Jack’s credit score has been recorded, graphed, and is shown below.  Check out all the details on his progress here.

building credit score from scratch

The average credit score under 20 years old is a dismal 631.  Following these steps and graduating with a respectable credit score has many benefits.  Landlords check credit to evaluate tenants.  High credit scores lead to lower interest rates on mortgages and other loans.  Some employers even check credit to evaluate prospective employees.  For disciplined credit card users, a high score can lead to opportunities for credit card perks and bonuses.

Now go, get started, and build a credit score from scratch.

Posted in Credit cards, credit score.


    • I remember in 2016, my credit score was horrible, I had so many collection accounts and would not approve for anything. I had rental debt,charge offs and more. I was then introduced to FINANCEHACKERS01atGMAILdotCOM and my credit score went from 529 to 820 within few days and I was able to get a home loan and eligible for several credit cards. You can also reach to them for help with your debts and credit repair services

      • I never been to this financehackers site. I don’t recommend it, and suspect it to be either a scam or business that charges fees. A good credit score can be built for free.

    • Some of the advice works for everyone, but I wanted to target college age kids, who haven’t make mistakes yet. I don’t have experience with fixing credit. I spent a little time checking my favorite blogger sites for a good article to suggest, but didn’t find one.

  1. Great post Mr. JumpStart! I followed these steps pretty much blindly growing up. I got my first credit card because it had a $250/mo no interest balance. I proceeded to never use this feature but the card was open. I love the neat layout of the steps!

    • Thanks HM. It will be interesting to see my son’s score at age 21. He still hasn’t turned 19 yet, and his score is pretty good.

        • His USAA youth accounts automatically changed to adult accounts a few weeks after his 18th birthday.
          I’ve been on the lookout for some easy bank account bonuses.

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