Financial Wellness Minute: Building Your Credit Score

Get smarter about your money with this Financial Wellness Minute. I'm Patrick Voigt, office manager at Mid Minnesota Federal Credit Union in Detroit Lakes. Today, we are talking about building a credit score. This time of the year brings graduation celebrations! No matter what's next for the young adult in your life, starting to build a good credit score will be critical. A person's credit score is an indicator of financial health and can impact your insurance rates, ability to rent an apartment, and even get a job. Not to mention getting a loan for school, a car or home in the future. Unfortunately, we all start from a score of 300 and need to build to a good score of 640 or better over time. A great place to start is to establish both an installment loan and revolving line of credit. An installment loan is a small loan that helps demonstrate that you can make your payments on time. You can get a loan like this by using money you have saved as collateral or look for a credit builder loan option that doesn't tie up your savings. A revolving line of credit is a credit card. Start with a low amount, say $500, and only charge $100 worth of expenses each month. Then, pay it off right away. By establishing these two types of loans you will be well on your way to building a strong credit score! Want to know more about credit scores or have a weekly financial wellness tip sent to you? Sign up below or, contact your local Mid Minnesota Federal Credit Union Office. Sign Up for a Weekly Financial Wellness Tip Mid Minnesota Federal Credit Union is federally insured by the NCUA and we are an Equal Housing Lender.