As an Australian, the fact that you need to do this is insane. As long as you pay your bills on time and have good saving history, that's enough of a credit history.
As a symptom of how broken the system is, some credit companies have started offering paid services where they'll take a "closer look" at things like paying bills in order to boost your score. With that being said, building credit is really not hard in the U.S. unless you are abjectly poor, in which case it's only one of the problems keeping you trapped in a cycle of debt. As long as you make enough to pay for rent and groceries, it's pretty easy to get a high-tier score after a few years of a responsible credit card use. Which arguably makes the entire system more of a joke, since a good score doesn't even mean much. At some point, you reach a plateau where even rich people can't get a better score unless they do weird crap to get the number to go u artificially, which some people do even though banks don't care anymore beyond that plateua.
@@TaliyahP Yes, but you don't need to do credit cards and other stuff to get a good credit score was my point. Which is good because I'm firmly against credit cards and have never had one and never will. It's just living your life without doing anything special which is not what they were taking about in the video
As a European who’s never had to deal with the ‘Credit Score’ system before, “Credit Builder Loans” sound almost like a scam! You end up paying a bank a small amount of interest to build a score that they use to assess you for THEIR OWN products!? How on earth is such a system even allowed? 🤯😨
All due respect, Europe's financial system is way worse at assessing non-performing loans. Even the most stringent German banks have a significantly higher level of bad debt they will eventually have to write off, and that will trickle into the economy at the worst possible time, like an impending recession/depression. So while America does have a harder system to build consumer credibility, it probably has a good reason for doing so.
@@yankeefederer1994 the reason why we have a credit system in the US, is to keep minorities from buying houses. Look it up, it was created with the idea that black people wont be able to buy a house, and thus the white mans wealth is protected and redlining is legal again
@@rameneater1437 Which is why everyone has to be vetted by the credit system today? Not saying one can't be discriminated on a loan application based on the ethnicity of the name, or other factors. But performance history is a very good way to figure out whether someone can/will pay back a loan.
My biggest tip as someone trying to start into credit. Automatic payments on credit cards so you never worry about forgetting!!! Use it on things that you normally spend like gas or groceries!!
You should take the opportunity to evaluate your spending every month by actually looking at the bill. Automatic payments are nice, but if you're blind to the fact that you're incurring a $3000 a month spending debt against $2000 a month of income... the autopayments aren't going to help you here.
@@sor3999 Setting up automatic payments doesn't mean you stop looking at your statements and monitoring account activity. Lol What a strange thing to assume.
Even without watching this. Secured credit card! I did that as a 17 year old wayyyyy back many decades. And manage them well. I am proud to say that I have never once paid a cent in interest to a credit card company. Well, once or two times a bill got overlooked and I paid the stupid tax, late fees. My credit score is currently 842. I don't know what it takes to get to that magic 850.
Congrats! I Finally made it to 822 in my 40s after doing every wrong thing since college where they were staked out dispersing credit everyday. I cringe at how much interest I paid. Experian says I "need" mortgage exposure to go higher. Eff that. Would love a house but not at these modern prices and certainly not for a higher score.
I started my credit journey with a secured card, after a year I applied for a regular card at the same company. Now, 10 years later, my credit score is 800+! What a journey it has been.
I started working on my credit a couple of months ago. I got a credit card with a $200 limit and I put my streaming (Netflix, Hulu, Amazon Prime) and car insurance on it on autopay. It all adds up to less than the $200 limit, but comes close. I paid the balance before the bill was due and my credit score went from non-existent to almost 700!
@@luisandrade2254 Within the first month I used the card and paid the balance off several times before the first bill was even ready. Then, suddenly, I had a credit score.
I work at a big five bank in Canada and for credit cards, only the primary cardholders credit bureau is reported on for any and all cards on the account. I remind my clients each time in depth that they are responsible for their authorized users spending. It can get ugly.
Highly recommend starting at an early age to work on your credit. The earlier you can establish a good, long credit history, the more preferential interest rates you can get on a loan (like a car/mortgage). Also, once you graduate from secured cards, look into churning credit card points/perks.
@@flopsinator5817 they're not recommending borrowing money to buy a car, they're saying good credit history will give you a better interest rate on those loans
@@Austin-fc5gs The first rule of buying a car: don't borrow money for it! It's just that OP and Two Cents make borrowing money for a car sound like the most normal thing in the world. It's horrible financial advice really.
That is insane. And some people think the USA is this amazing magical place where in actuality you are constantly predated on by every single institution.
My dude poor countries, countries that are fighting armed conflicts, and the countries that are ran by dictators that America is a magical place. What conservative politicians fail to explain is that most of the people that come to America are usually desperate and are not coming from stable First World countries.
Important part about inquiries is that multiple inquiries for same purpose in a short time (in my case experience 2 weeks) count as one. So don’t let anyone scare you from shopping around for loan when buying a car.
I remember going round and round with someone in a Usenet forum who insisted her being rejected for credit when she had only used cash was a moral judgment on her. She kept insisting she was a good person and "they" had no right to say she was bad. Myself and others tried to get her to understand what was in this video, but she insisted on being offended at being told she was a bad person, so we started ignoring her.
the best way to use a credit card and not get into debt is use your credit card like a debt card. in other words use it like as if you have the money and pay it off right away. like lets say you go grab lunch and its $10 instead of using you debt card or cash you a credit card, when the statement posts to you account pay of the whole thing right away. not only will you stay out of debt but you'll build your credit fast too. for example I got my first card at 18 if was a secured card with a credit limit I had to pay up front in cash fast forward to today I'm 21 now with a 800 score and I have no debt, I pay off my cards in full every month.
Yeah, debit cards and credit cards can functionally be the same. Just debit cards require the money in the account up front while the credit card is after the purchase. Only difference is the order here. But many young people treat getting a credit card as "free money" they somehow think they can just run away with lol.
1. See if one with good credit in your family will add you as authorize user on their credit card 💳 2. If not go to for a secure credit from cap1, chase, or discoveror finance a watch at a jewelry store. 3. Put automatic payment for statement balance.
I am so thankful for you guys and the easy to Understand info you provide. I didn’t have the best parents growing up And they don’t exactly teach this important stuff in schools (although they should. I have never once used the Pythagorean theorem in my adult life but I digress) so I’m very thankful I happened upon this channel as I have learned so much. Thanks! :-)
After being clueless with my first credit card when I was 19 or 20 when I didn't even have a regular income (why did they offer me one in the first place?) I totally misused it and then avoided using credit cards like the plague for the next two decades. I finally started using one (secured) last year and I was "graduated" as mentioned in the video to the unsecured with a higher limit. I admit I am still a little afraid of them, but thought that I probably should start generating a good credit history now that I have a better idea what I'm doing. 🙂 This time around it is a lot easier since everything is online. I don't have to mentally keep track and wait for the bill to arrive like before so I can quickly see my balance and pay as early and as often as I want.
This whole system sounds incredibly stupid to be completely honest if Americans want to use a credit score system they should at least allow for rent and bill payments to count towards credit worthiness
It would if rent and bill payments were loaned money, but they aren't. You can absolutely treat credit cards and loans the same way, but that's the distinction.
One of the credit reporting agencies does have something that allows certain bills to count towards your credit score. It's called Experian Boost. The problem is that it requires you to link your bank account so they can look through the transactions and verify that you're paying those bills which is a privacy nightmare IMO.
A lot of these things described here sound like it was for people who ruined their credit worthiness. I never needed to do any of these things to start having credit. I was approved for a small limit credit card, like $1000, as a teenager and just used it like a debit card. Pay on time and slowly you build your credit profile. Nothing to it.
If you're heading to college, don't get enticed by banks' student 0% APR offers unless you're going to stay on top of it. No need to graduate with both student loans and crippling credit card debt!
Some services like Petal Card don't require you to have an existing score at all. They use history of checking accounts and savings accounts to see how well you manage money, and determine your eligibility based on that. I didn't have to put any money down either
I don't want to give you too much heat, but it's great to see Philip doubling down on great fashion sense like the tattoos - though I wouldn't mind seeing the mustache again. Thank you for your videos as well; they genuinely helped me out a lot, I hope they stand to get lots of hits in the future, and I'll bet you know what I mean.
One note about hard credit inquiries, when you're shopping for a mortgage from multiple banks, as long as you shop around within a short time period (I believe it's a few weeks) then it will only count as one inquiry.
I started off with a capital one card with a 300 dollars credit limit and a 65 dollars anual fee. Used it purchase things using the rule of half. Jumped to 500, 1000, 1200.. limit 0 annual fee. Now I have 10 credit cards with a zero balance and an 830 credit score.
I had to build my credit from scratch after I filed bankruptcy in 2011. I started out with a secured credit card. Then I applied for a car loan and regular credit card which I pay on time.
If you are a student don’t waste your money on a secure credit card. The deposit might not get returned and you can get a student card simply by showing your acceptance letter or other prof that you are attending college. Use the card responsibly lie they said in the video.
I love these videos. They are super helpful. But most of them are about the American system. Where can I look for information about my own country? And how do I know if I can trust the information I get?
I remember being 21 with no credit when the bank teller first told me about a credit card and I remember thinking, you have my income right in front of you, I can't afford to pay anybody 🤣😅
Biggest tip for younger kids is to be an authorized user on a parents credit card if they are responsible and also have good credit, apply for a credit card when you’re 18. And if you are able to be responsible keep opening credit cards to have more credit and that will lower your utilization score over the years.
I NEEDED THIS FROM YALL THANK GOD. I’m a college student who has a 670 who hasn’t done anything to even get a credit score except check it. So yes, please show me the way
Uk version is much much simpler. I got my first credit card with £2,600 limit and a 6.7% APR. 'Why so low' I asked. 'I've never borrowed any money, or had a loan or finance or anything' 'Well, you have a high credit score. Because everytime you purchase something on your debit card. It takes several days to clear. Since all transactions you have done have all cleared on time. Its given you a good credit score'
Can you (not should you, that's a whole different conversation) but can you add a minor child as an authorized user to start their credit history? Just by being a user do they get the affects or do "they" have to buy stuff on thier card?
i’m 35 with fair credit. never used credit cards but did car loans and healthcare loans. paid em all early. my question is where do i even start? i’m not a big spender. in fact i’m more on the cheap frugal lifestyle side so debt is very unattractive to me especially seeing what it can do to ppl that screw up. i just want my savings to go further and not sit losing value
This is a completely insane concept. In my country you just send your last 12 monthly salary statements to the bank and they calculate how much you can pay per month, and then just take the money out of your account every month right after you get your salary. Simple. You get the loan and the bank gets paid. Why would anybody want to waste time like this lending money to themselves with a pile of credit cards? You are just trying to hack a system that's not necessary in the first place.
Definitely a good time to start building your credit though! I got my first card at 19 and it allowed me to build up sufficient credit history to buy a house at 27, so definitely get to it!
@@Sonicfan138 I've been thinking about a secured card but I'm just not sure if I would be responsible with it since I don't work all year round right now because I'm a college student
@@lilyyoung1002 That's ok! I would still highly recommend getting a secured card if it's available. If you don't have a regular income, just it a couple times a month (coffee, lunch etc) and pay off the balance. It's really never too early to start. And if you feel like you'd use it too much, don't carry it on your person at all times and don't use it for online purchases. Leave it in a drawer (secured, of course).
0:33 If you want to know whether I pay my bills on time or not, you can contact Colorado Springs Utilities; you can contact Xfinity; you can contact State Farm; you can contact any number of contractors who have done work at my house; you can contact anyone whom I’ve ever paid…
can you do one on how to get started buying places to rent on air bnb..... and run the numbers? I was looking into investments and loans i would need for that
In 2017 my credit cards got closed and went to collections, after I paid off my outstanding bill I was left with no credit history at all. Now I put $12,000 in a fixed deposit and got a secured credit card which I am using responsibly and paying off on time after getting my statement to build up my credit score again. Hopefully in about a year I can jump to an unsecured card and make up for my past mistakes.
My husband and I are going to put our son as an authorized user on our joint card. We're financially responsible and want to start building his credit score early.
I don’t have a credit score and i have 0 percent apr credit card for next 1 year should i pay full amount or minimum amount (since I am keeping that money in high yield saving account) and Also I am maintaining my credit utilization under 30 percent
Meh. Credit score is currently 796. My credit score has only "mattered" the two times I've moved into an apartment/house on my own. Never had a car payment. And Manual Underwriting is thing when it's time to buy a house. So from my point of view credit scores are wholly useless things and a scam. 🤷♂️
Just sounds like it was "useless" for you if you never got a mortgage or bought a car or need higher credit limits. And no one is going to "manual underwrite" your loan. You already have a known score and they will use it.
My husband opened a secured credit card with a deposit of $550 few months ago we kept our utilization low and paid on time. Our score is now 708 but plan on boosting it and apply for a real credit card. Its so confusing when we speak with somebody from the bank about applying for a regular credit card but they speak in non understandable terms
Didn’t know the utilization is also important! Before I thought it would be better to use as much as possible the credit card and pay it off on time. Need to change that behavior now 😅
I got my first credit card right at 18 to build credit. Now I'm 22 and i still have that card, plus one more i got a few years later, and a home mortgage. My credit score is at 799 🥳 and i never paid any interest on either of my cards!!
I heard that paying off a credit card immediately was bad for your credit is this true? I wanted to build credit by only buying gas for my car with my credit card and then just paying it off as soon as I got home but some people told me that would actually hurt my credit is this true?
Can you explain why FICO fluctuates 50 points a month back and forth with no real change is spending habits? How paying off school loans took 90 points( never recovering)
When you pay off a long term loan it may actually hurt your credit score. Credit score is not necessary about getting out of debt. It is about showing that you are a good borrower, can manage these debts and pay them on time. With the idea of letting you borrow more money. When you paid off the loan, it lowered your credit score because you have 1 less loan (amount of money lent to you) in your credit report. Also, it means you are now eligible to borrow more money from a new loan or credit card. So you are higher risk. Credit Reporting companies want to see you in debt. You appear to be trying to better yourself by getting out of debt. One last thing your credit card company or even local bank/credit union should have the ability to see a detailed report of your credit and why it is lowering or being raised. That can be accessed using a mobile app or web site easily.
@@Marthastewart209. so i guess the question is, how do i stay debit free ( and moreso not have to pay usury charges [aka interest ] on anything ) while keeping a crdit score up? I spend money, i get a credit hit. I pay off debit, i get a credit hit. Its lose -lose.
I'm 24 and I never got a credit card. I have been paying my student loans consistently for 2 years now though, hopefully that counts. I gotta talk to my bank one of these days.
Credit is the stupidest thing. They will give a 18 year old 100k plus in student debt but they wont give a 29 year old a loan because they have no credit history.
@Two Cents This video has its comment section filled with scam comments. Please get rid of them, it hurts your own reputation and may lead to some of your viewers being scammed
I still don't get this "utilization rate" thing which should not exist. For example, if one pays on time for several years, it renders the "utilization rate" factor useless. It could be useful to detect how a user in a financial bad situation vs the one who just usually pays late with low utilization
How can we know what caused changes to our scores? For example, after I paid off several of my student loans, my credit *dropped* by 10 points. I have no other debts and pay off my credit card before it's due. There were also no inquiries to my credit that I know of.
Been working for a financial institution for five years, and I have a question that I haven’t really been able to find the answer to. Is 30 days past due, from the date your payment was supposed to occur, or from the previous payment date? I’m guess it’s the former, but I’ve never gotten actual clarification
I have heard that in US, credit score is higher for those who do not necessarily pay on time but make occasional late payments, compared to those who pay on time every time, all other factors being the same. The supposed logic behind this is, the former is more extortion-worthy and therefore more profitable to the banks, than the latter person. Is there any truth to this?
As an Australian, the fact that you need to do this is insane. As long as you pay your bills on time and have good saving history, that's enough of a credit history.
As a symptom of how broken the system is, some credit companies have started offering paid services where they'll take a "closer look" at things like paying bills in order to boost your score.
With that being said, building credit is really not hard in the U.S. unless you are abjectly poor, in which case it's only one of the problems keeping you trapped in a cycle of debt. As long as you make enough to pay for rent and groceries, it's pretty easy to get a high-tier score after a few years of a responsible credit card use. Which arguably makes the entire system more of a joke, since a good score doesn't even mean much. At some point, you reach a plateau where even rich people can't get a better score unless they do weird crap to get the number to go u artificially, which some people do even though banks don't care anymore beyond that plateua.
"As long as you pay your bills on time"
I mean you just described credit building... Things like your phone bill are reported to the credit bureaus.
@@TaliyahP Yes, but you don't need to do credit cards and other stuff to get a good credit score was my point. Which is good because I'm firmly against credit cards and have never had one and never will. It's just living your life without doing anything special which is not what they were taking about in the video
Heard you guys have a good education system too.
The bank ain't gonna let u buy a 400,000 $ house just cause u have money in your bank
As a European who’s never had to deal with the ‘Credit Score’ system before, “Credit Builder Loans” sound almost like a scam! You end up paying a bank a small amount of interest to build a score that they use to assess you for THEIR OWN products!? How on earth is such a system even allowed? 🤯😨
It is a scam. This is how the youth are stopped from buying cars and houses. Poor staying poor etc.
All due respect, Europe's financial system is way worse at assessing non-performing loans. Even the most stringent German banks have a significantly higher level of bad debt they will eventually have to write off, and that will trickle into the economy at the worst possible time, like an impending recession/depression. So while America does have a harder system to build consumer credibility, it probably has a good reason for doing so.
@@yankeefederer1994 the reason why we have a credit system in the US, is to keep minorities from buying houses. Look it up, it was created with the idea that black people wont be able to buy a house, and thus the white mans wealth is protected and redlining is legal again
@@rameneater1437 Which is why everyone has to be vetted by the credit system today? Not saying one can't be discriminated on a loan application based on the ethnicity of the name, or other factors. But performance history is a very good way to figure out whether someone can/will pay back a loan.
@@yankeefederer1994 it was CREATED with discrimination in mind
My biggest tip as someone trying to start into credit. Automatic payments on credit cards so you never worry about forgetting!!! Use it on things that you normally spend like gas or groceries!!
You should take the opportunity to evaluate your spending every month by actually looking at the bill. Automatic payments are nice, but if you're blind to the fact that you're incurring a $3000 a month spending debt against $2000 a month of income... the autopayments aren't going to help you here.
@@sor3999 Setting up automatic payments doesn't mean you stop looking at your statements and monitoring account activity. Lol What a strange thing to assume.
Even without watching this. Secured credit card! I did that as a 17 year old wayyyyy back many decades. And manage them well. I am proud to say that I have never once paid a cent in interest to a credit card company. Well, once or two times a bill got overlooked and I paid the stupid tax, late fees. My credit score is currently 842. I don't know what it takes to get to that magic 850.
Yeah, that 850 is elusive. I'm at an 820 and I've done pretty much what you did.
Humble brag
Congrats! I Finally made it to 822 in my 40s after doing every wrong thing since college where they were staked out dispersing credit everyday. I cringe at how much interest I paid.
Experian says I "need" mortgage exposure to go higher. Eff that. Would love a house but not at these modern prices and certainly not for a higher score.
I started late at 22, so far so good sitting at a score of 745. The goal is to make it to the 800 club by the time I want to buy house.
@@bagery You did well! The banks were looking for new -meat-, clients to snag. That wasn't cool. Cool that you didn't take the bait.
I started my credit journey with a secured card, after a year I applied for a regular card at the same company. Now, 10 years later, my credit score is 800+! What a journey it has been.
I started working on my credit a couple of months ago. I got a credit card with a $200 limit and I put my streaming (Netflix, Hulu, Amazon Prime) and car insurance on it on autopay. It all adds up to less than the $200 limit, but comes close. I paid the balance before the bill was due and my credit score went from non-existent to almost 700!
Okay?
How long did you take btw?
@@luisandrade2254 Within the first month I used the card and paid the balance off several times before the first bill was even ready. Then, suddenly, I had a credit score.
@@davidnievesjr.9478 wow that’s truly impressive glad for you
would you have had those streaming services tho without credit? if not then you just playing yourself
I work at a big five bank in Canada and for credit cards, only the primary cardholders credit bureau is reported on for any and all cards on the account. I remind my clients each time in depth that they are responsible for their authorized users spending. It can get ugly.
Highly recommend starting at an early age to work on your credit. The earlier you can establish a good, long credit history, the more preferential interest rates you can get on a loan (like a car/mortgage). Also, once you graduate from secured cards, look into churning credit card points/perks.
I'm confused, why on on earth would you borrow money for a car?
@@flopsinator5817 they're not recommending borrowing money to buy a car, they're saying good credit history will give you a better interest rate on those loans
@@Austin-fc5gs The first rule of buying a car: don't borrow money for it!
It's just that OP and Two Cents make borrowing money for a car sound like the most normal thing in the world.
It's horrible financial advice really.
How about just buying a reasonable flipping car and house instead that you can actually afford?
@@penultimateh766 For almost everyone it's virtually impossible to buy a house without borrowing money.
This is Mr. Chambers' Financial Literacy class. We love the content. You guys do great work. We miss the mustache very much.
That is insane. And some people think the USA is this amazing magical place where in actuality you are constantly predated on by every single institution.
My dude poor countries, countries that are fighting armed conflicts, and the countries that are ran by dictators that America is a magical place. What conservative politicians fail to explain is that most of the people that come to America are usually desperate and are not coming from stable First World countries.
Important part about inquiries is that multiple inquiries for same purpose in a short time (in my case experience 2 weeks) count as one. So don’t let anyone scare you from shopping around for loan when buying a car.
The piggyback method works extremely well. I went from an N/A to almost 800 in less than 4 months. Of course the person needs to be reliable.
I remember going round and round with someone in a Usenet forum who insisted her being rejected for credit when she had only used cash was a moral judgment on her. She kept insisting she was a good person and "they" had no right to say she was bad. Myself and others tried to get her to understand what was in this video, but she insisted on being offended at being told she was a bad person, so we started ignoring her.
the best way to use a credit card and not get into debt is use your credit card like a debt card. in other words use it like as if you have the money and pay it off right away.
like lets say you go grab lunch and its $10 instead of using you debt card or cash you a credit card, when the statement posts to you account pay of the whole thing right away.
not only will you stay out of debt but you'll build your credit fast too. for example I got my first card at 18 if was a secured card with a credit limit I had to pay up front in cash fast forward to today I'm 21 now with a 800 score and I have no debt, I pay off my cards in full every month.
Yeah, debit cards and credit cards can functionally be the same. Just debit cards require the money in the account up front while the credit card is after the purchase. Only difference is the order here. But many young people treat getting a credit card as "free money" they somehow think they can just run away with lol.
*debit
1. See if one with good credit in your family will add you as authorize user on their credit card 💳
2. If not go to for a secure credit from cap1, chase, or discoveror finance a watch at a jewelry store.
3. Put automatic payment for statement balance.
I am so thankful for you guys and the easy to
Understand info you provide. I didn’t have the best parents growing up
And they don’t exactly teach this important stuff in schools (although they should. I have never once used the Pythagorean theorem in my adult life but I digress) so I’m very thankful I happened upon this channel as I have learned so much. Thanks! :-)
Exactly
Two Cents coming in clutch as I learn to navigate adulthood
Your tattoos are coming along! 🙂 I love these videos.
In our country, we started using the credit score system and im glad to have built a good credit score since 2013!
After being clueless with my first credit card when I was 19 or 20 when I didn't even have a regular income (why did they offer me one in the first place?) I totally misused it and then avoided using credit cards like the plague for the next two decades. I finally started using one (secured) last year and I was "graduated" as mentioned in the video to the unsecured with a higher limit. I admit I am still a little afraid of them, but thought that I probably should start generating a good credit history now that I have a better idea what I'm doing. 🙂 This time around it is a lot easier since everything is online. I don't have to mentally keep track and wait for the bill to arrive like before so I can quickly see my balance and pay as early and as often as I want.
You two do such a great job!
a great job would be listing the names and addresses of the people who set these policies
Simplified, easy to understand and a great foundation block for new and tenured credit users! Great video, as always!
Didn’t think a secured card can become unsecured, for anyone who hasn’t began, definitely look into that.
Living under a rock huh?
@@jollama Yep. No mortgage payments to worry about.
This whole system sounds incredibly stupid to be completely honest if Americans want to use a credit score system they should at least allow for rent and bill payments to count towards credit worthiness
It would if rent and bill payments were loaned money, but they aren't. You can absolutely treat credit cards and loans the same way, but that's the distinction.
@@sor3999 But you do still need to pay month to month and thus can show you are responsible and can pay on time, which is what matters
One of the credit reporting agencies does have something that allows certain bills to count towards your credit score. It's called Experian Boost. The problem is that it requires you to link your bank account so they can look through the transactions and verify that you're paying those bills which is a privacy nightmare IMO.
@@sor3999 the power company runs my credit before hookup but dosent report unless i have delinquent bills
That was the idea! it was intentionally rigged to keep poor people, black people, and migrants from climbing up the system.
That's what I did. I added myself to my mom's credit card and my credit score shot up. Now that's a good cash free inheritance.
A lot of these things described here sound like it was for people who ruined their credit worthiness. I never needed to do any of these things to start having credit. I was approved for a small limit credit card, like $1000, as a teenager and just used it like a debit card. Pay on time and slowly you build your credit profile. Nothing to it.
If you're heading to college, don't get enticed by banks' student 0% APR offers unless you're going to stay on top of it.
No need to graduate with both student loans and crippling credit card debt!
Thank you very much guys!!
Been watching you guys for years, here and there. Was a surprised that you guys have tattoos. That's cool that PBS let you guys have them.
Man, this is something I had to deal with this. I hate credit cards with a passion though and never got them.
Imagine hating free flights, free hotel stays and free global entry
I'm about to be 33 and I've actually never heard of a secured credit card before o.o
Yeah it's a product mostly offered by credit unions.
Some services like Petal Card don't require you to have an existing score at all. They use history of checking accounts and savings accounts to see how well you manage money, and determine your eligibility based on that. I didn't have to put any money down either
omg You have a tattoo sleeve!!!! That is so cool 😎🤘
I don't want to give you too much heat, but it's great to see Philip doubling down on great fashion sense like the tattoos - though I wouldn't mind seeing the mustache again.
Thank you for your videos as well; they genuinely helped me out a lot, I hope they stand to get lots of hits in the future, and I'll bet you know what I mean.
One note about hard credit inquiries, when you're shopping for a mortgage from multiple banks, as long as you shop around within a short time period (I believe it's a few weeks) then it will only count as one inquiry.
Love you guys :)
I started off with a capital one card with a 300 dollars credit limit and a 65 dollars anual fee. Used it purchase things using the rule of half. Jumped to 500, 1000, 1200.. limit 0 annual fee. Now I have 10 credit cards with a zero balance and an 830 credit score.
I already know all this but it's everything I had to learn on my own in a 10min vid
Thank You
WORDS ARE NOT ENOUGH TO EXPRESS MY GRATITUDE TOWARDS YOUR KINDNESS TO OUR FAMILY WE ALL SAY THANK FOR GETTING THE SBA DONE.
Dave Ramsey has entered the chat
Sorry, he just exploded after hearing the word credit.
YOUR ACT OF KINDNESS AND SERVICE SHOW HOW BIG OF A HEART YOU HAVE FOR OTHER. THANKS FOR THE SBA YOU SCUH AMAZING.
Bring the moustache back.
I had to build my credit from scratch after I filed bankruptcy in 2011. I started out with a secured credit card. Then I applied for a car loan and regular credit card which I pay on time.
If you are a student don’t waste your money on a secure credit card. The deposit might not get returned and you can get a student card simply by showing your acceptance letter or other prof that you are attending college. Use the card responsibly lie they said in the video.
2:57 In addition to this, for the *best* credit building keep it below 10%.
great channel
I love these videos. They are super helpful. But most of them are about the American system. Where can I look for information about my own country? And how do I know if I can trust the information I get?
Welcome back!
Well done
I remember being 21 with no credit when the bank teller first told me about a credit card and I remember thinking, you have my income right in front of you, I can't afford to pay anybody 🤣😅
Biggest tip for younger kids is to be an authorized user on a parents credit card if they are responsible and also have good credit, apply for a credit card when you’re 18. And if you are able to be responsible keep opening credit cards to have more credit and that will lower your utilization score over the years.
2:55 I have discipline and self-control. I only spend money that I already have.
Nice sleeve Phillip!
I NEEDED THIS FROM YALL THANK GOD. I’m a college student who has a 670 who hasn’t done anything to even get a credit score except check it. So yes, please show me the way
Uk version is much much simpler. I got my first credit card with £2,600 limit and a 6.7% APR. 'Why so low' I asked. 'I've never borrowed any money, or had a loan or finance or anything'
'Well, you have a high credit score. Because everytime you purchase something on your debit card. It takes several days to clear. Since all transactions you have done have all cleared on time. Its given you a good credit score'
Can you (not should you, that's a whole different conversation) but can you add a minor child as an authorized user to start their credit history? Just by being a user do they get the affects or do "they" have to buy stuff on thier card?
People do this and from what I have heard it is a good idea
We miss the mustache
i’m 35 with fair credit. never used credit cards but did car loans and healthcare loans. paid em all early. my question is where do i even start? i’m not a big spender. in fact i’m more on the cheap frugal lifestyle side so debt is very unattractive to me especially seeing what it can do to ppl that screw up. i just want my savings to go further and not sit losing value
Read this book, or listen to audio book: "The Simple Path to Wealth".
You act like you’ve never heard of Google
This is a completely insane concept. In my country you just send your last 12 monthly salary statements to the bank and they calculate how much you can pay per month, and then just take the money out of your account every month right after you get your salary. Simple. You get the loan and the bank gets paid. Why would anybody want to waste time like this lending money to themselves with a pile of credit cards? You are just trying to hack a system that's not necessary in the first place.
does Amazon pay later or any other no cost emi platforms count as credit
the accuracy is just damn.... literally 16 percent
Thanks for this video. I don't have much of a credit history at 19 and I don't have a credit card yet.
Definitely a good time to start building your credit though! I got my first card at 19 and it allowed me to build up sufficient credit history to buy a house at 27, so definitely get to it!
Don’t worry about any of this and just keep playing Minecraft
@@0_1_2 I don't even play Minecraft
@@Sonicfan138 I've been thinking about a secured card but I'm just not sure if I would be responsible with it since I don't work all year round right now because I'm a college student
@@lilyyoung1002 That's ok! I would still highly recommend getting a secured card if it's available. If you don't have a regular income, just it a couple times a month (coffee, lunch etc) and pay off the balance. It's really never too early to start. And if you feel like you'd use it too much, don't carry it on your person at all times and don't use it for online purchases. Leave it in a drawer (secured, of course).
That "Credit Builder Loans" sounds like a stupid idea
The whole credit score system is a usury based scam.
Never lose your critical thinking skills. Even if your friends are all doing it.
0:33 If you want to know whether I pay my bills on time or not, you can contact Colorado Springs Utilities; you can contact Xfinity; you can contact State Farm; you can contact any number of contractors who have done work at my house; you can contact anyone whom I’ve ever paid…
The very needed video amid global recession.
Yeah always good to borrow during a recession.
can you do one on how to get started buying places to rent on air bnb..... and run the numbers? I was looking into investments and loans i would need for that
please and thank you. owning property and renting it on air bnb
Please make a video on Grameen Bank model. Read his 3 books recently. Just amazing. It'll help many if you bring it to the fore.
Wonderful video, as always. I'm curious what the backstory is to the very heavily laden sarcasm tones to the Patreon message at the end of the video 🧐
In 2017 my credit cards got closed and went to collections, after I paid off my outstanding bill I was left with no credit history at all. Now I put $12,000 in a fixed deposit and got a secured credit card which I am using responsibly and paying off on time after getting my statement to build up my credit score again. Hopefully in about a year I can jump to an unsecured card and make up for my past mistakes.
Imagine having to rebuild your credit
My husband and I are going to put our son as an authorized user on our joint card. We're financially responsible and want to start building his credit score early.
The best thing you can do. My parents did when I was younger and a month after I turned 18 it was so easy to open my open student credit card.
I don’t have a credit score and i have 0 percent apr credit card for next 1 year should i pay full amount or minimum amount (since I am keeping that money in high yield saving account) and Also I am maintaining my credit utilization under 30 percent
Meh. Credit score is currently 796. My credit score has only "mattered" the two times I've moved into an apartment/house on my own. Never had a car payment. And Manual Underwriting is thing when it's time to buy a house. So from my point of view credit scores are wholly useless things and a scam. 🤷♂️
Just sounds like it was "useless" for you if you never got a mortgage or bought a car or need higher credit limits. And no one is going to "manual underwrite" your loan. You already have a known score and they will use it.
My husband opened a secured credit card with a deposit of $550 few months ago we kept our utilization low and paid on time. Our score is now 708 but plan on boosting it and apply for a real credit card. Its so confusing when we speak with somebody from the bank about applying for a regular credit card but they speak in non understandable terms
Lol remember when everyone was laughing at China's social credit score, which btw, was just a proposal and got nowhere near being approved.
lie. It is being used.
@@catkasimir A trial doesn't mean it's approved yet.
It's real and thriving. Good documentary on it
I love that shirt
I hate the credit score algorithms because I paid off my car early to purchase a home and my score dropped.
Just asking: doesn't paying Bills (Phone Bills and everything Else) build the Credit History?
Didn’t know the utilization is also important! Before I thought it would be better to use as much as possible the credit card and pay it off on time. Need to change that behavior now 😅
Living under a rock huh?
I got my first credit card right at 18 to build credit. Now I'm 22 and i still have that card, plus one more i got a few years later, and a home mortgage. My credit score is at 799 🥳 and i never paid any interest on either of my cards!!
Hey here's a genius concept: Don't spend money you don't have, then you won't need to borrow money.
I heard that paying off a credit card immediately was bad for your credit is this true? I wanted to build credit by only buying gas for my car with my credit card and then just paying it off as soon as I got home but some people told me that would actually hurt my credit is this true?
Can you explain why FICO fluctuates 50 points a month back and forth with no real change is spending habits?
How paying off school loans took 90 points( never recovering)
When you pay off a long term loan it may actually hurt your credit score. Credit score is not necessary about getting out of debt. It is about showing that you are a good borrower, can manage these debts and pay them on time. With the idea of letting you borrow more money.
When you paid off the loan, it lowered your credit score because you have 1 less loan (amount of money lent to you) in your credit report. Also, it means you are now eligible to borrow more money from a new loan or credit card. So you are higher risk.
Credit Reporting companies want to see you in debt. You appear to be trying to better yourself by getting out of debt.
One last thing your credit card company or even local bank/credit union should have the ability to see a detailed report of your credit and why it is lowering or being raised. That can be accessed using a mobile app or web site easily.
@@Marthastewart209. so i guess the question is, how do i stay debit free ( and moreso not have to pay usury charges [aka interest ] on anything ) while keeping a crdit score up?
I spend money, i get a credit hit.
I pay off debit, i get a credit hit.
Its lose -lose.
No wonder I kept getting dined a credit credit even though I have no credit history.
I'm 24 and I never got a credit card. I have been paying my student loans consistently for 2 years now though, hopefully that counts. I gotta talk to my bank one of these days.
Does anyone know if credit score exists in Europe?
Is she pregnant? How exciting! 😊
Sick arm tattoo bro
Did he always had a sleeve ?
Ok
Credit is the stupidest thing. They will give a 18 year old 100k plus in student debt but they wont give a 29 year old a loan because they have no credit history.
@Two Cents
This video has its comment section filled with scam comments. Please get rid of them, it hurts your own reputation and may lead to some of your viewers being scammed
I still don't get this "utilization rate" thing which should not exist. For example, if one pays on time for several years, it renders the "utilization rate" factor useless. It could be useful to detect how a user in a financial bad situation vs the one who just usually pays late with low utilization
You should do a video about passive income
How can we know what caused changes to our scores?
For example, after I paid off several of my student loans, my credit *dropped* by 10 points. I have no other debts and pay off my credit card before it's due. There were also no inquiries to my credit that I know of.
Dave has entered the chat
Been working for a financial institution for five years, and I have a question that I haven’t really been able to find the answer to. Is 30 days past due, from the date your payment was supposed to occur, or from the previous payment date? I’m guess it’s the former, but I’ve never gotten actual clarification
Wow and i thought i never took any credit so banks will open heartedly lend me money
I have heard that in US, credit score is higher for those who do not necessarily pay on time but make occasional late payments, compared to those who pay on time every time, all other factors being the same. The supposed logic behind this is, the former is more extortion-worthy and therefore more profitable to the banks, than the latter person. Is there any truth to this?
No, this is absolutely wrong. Late payments lowers your credit score by a lot!
best thing I did was get a student credit card. No approval needed based on income and builds history from an early age.
American madness !!