The Cheap and Easy Way to Build a Great Credit Score

Dear Mary: You have written in the past that it’s important that we keep our credit cards “active” even when we keep them at zero balance. How often should we use them to keep them active? Does it matter how much we put on them? Can it be a small purchase that we pay off immediately? Thanks. Nancy

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Dear Nancy: Using a credit card twice a year is more than sufficient to keep the account active. The purchase amount is inconsequential. Use it to purchase a 99-cent app and you’ll accomplish the goal. Then pay it off right away—even on the very same day. That way you won’t forget or run the risk of allowing a silly small purchase to create a rolling debt.

The system isn’t looking at the size of the purchase or the amount of time between purchase and repayment—only that a transaction is recorded and payment is received according to the terms and conditions you agreed to when you opened the account.

These days it’s important for every adult to own one good, all-purpose credit card for the purpose of maintaining a high credit score. To do so does not require one to carry a smidgen of debt (it’s NOT a debt score), nor to use the thing habitually. You could use your card to purchase two apps a year ($1.98 total, paid off immediately) and build a killer credit score. I have a feeling that’s exactly what you plan to do. Good for you!

Dear Mary: I’ve heard that adding someone to your credit card will help that person establish a credit history, even if they do not use the card. Is that true? How would I go about doing it? Pat

Dear Pat: It is true. You would add this person as an “authorized user” to your account by calling your credit card issuer’s customer service (find the toll-free number on the back of your card). An authorized user has all the privileges of using the account without any liability for repayment. I know it sounds crazy, but that’s the way it works. As activity on the account is reported to the credit bureaus, it goes into the files of the primary account holder (you) and also the authorized user’s file. That means the authorized user benefits from piggy-backing onto your good credit being reported on that account. Just keep in mind that this could backfire if your authorized user decides to go nuts and runs the balance up to or beyond the limit. Not only will you be liable for full repayment, that negative activity will be reported to your credit file as well. Hope that helps.

Dear Mary: First off, thanks for all of your wonderful tips. I just moved into my first apartment, having lived in a big home for many years. How do I make these melamine cabinets shine? I’ve cleaned them with Blue Dawn and water but they still look streaked and dingy. Help! Katy

Dear Katy: I’m assuming this is a rental, so you probably don’t want to start painting those cabinets, although you could with a remarkable product, Rust-Oleum Cabinet Transformations, (available online as well as stores like Home Depot) formulated specifically for melamine (also known as Formica). Now that you’ve cleaned the cabinets well, I’d try a good furniture polish like Lemon Pledge. That just might do the trick! If you’re still not completely happy, invest a few bucks in one of my favorite kitchen products, Johnson’s Jubilee Kitchen Wax. Jubilee (a venerable product we can still find online) will clean and polish everything in your new kitchen including the melamine cabinets, Formica countertops and appliances, too. I love the stuff and I think you will too.

 

 

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2 replies
  1. Me says:

    Thanks for the tip about the credit cards. I added my grown (early 20s) kids to mine the last time you mentioned this on the blog.. Wish I had known about it when I first got the card about 5 years ago (my son would have been old enough).

    Reply
  2. Pat says:

    I have a question. My brother has no credit. He is on disability and gets almost $800 a month. He needs to get one of those dental credit cards for dental because medicare doesn’t pay for dental. He has over $2000 worth of work that needs to be done. I am getting ready to sign him up for it but not sure if it will be approved because he has no credit.

    Reply

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