Financial Education

How Do I Build Good Credit?

The Independent Community Bankers of America, or ICBA, offers these tips to help you build and maintain good credit:

• Open a checking account and keep careful track of your balance to help establish a credit history.


• Use debit and credit cards for convenience and safety. Be careful not to overspend and avoid missed or late payments, which can damage your credit and hurt your credit score.


• Develop a good mix of credit (such as a revolving credit line and an installment loan) to boost your credit score and demonstrate that you can manage different types of credit.


• Show stability in the three to six months before a major purchase. Avoid opening or closing accounts or moving large amounts of money around.


• Build an emergency fund equal to at least six months of living expenses, establishing a financial cushion to help absorb unexpected expenses and avoid penalties and fees for missed or late payments.


• Alter your credit focus as you approach different life stages. While Gen Z might be saving for a down payment, Gen Xers or Baby Boomers may be paying down debt to plan for retirement, respectively.


• Monitor your credit regularly so you can correct any errors and detect potential signs of identity theft. Order a copy of your credit report annually from www.annualcreditreport.com or by calling 1-877-322-8228.

If you'd like to talk to more about how to establish good credit habits, call a bank representative at 215-634-7000.