Millionaire creator of 'Hamilton': Waiting until age 28 to open a credit card was a mistake

Lin-Manuel Miranda, creator of "Hamilton"
Tasos Katopodis | Getty Images

Lin-Manuel Miranda went from being a broke substitute teacher to creating the billion-dollar Broadway musical "Hamilton." The production has won 11 Tony Awards, a Pulitzer Prize, and earned Miranda at least $6.4 million.

The award-winning 37-year-old actor, writer and composer has learned a lot about managing his money and "how important it is to educate yourself about the basic principles of financial planning," he tells Morgan Stanley in a recent interview.

Miranda was always "cautious about spending," he says in the interview — almost too cautious, he now believes: "I was so nervous about incurring debt that I didn't open my first credit card until age 28, after my first show had opened on Broadway."

Actor, composer Lin-Manuel Miranda performs on stage during "Hamilton"
Theo Wargo | WireImage | Getty Images

While it's smart to be aware of your spending habits, letting fear of incurring debt keep you from opening a credit card can cause problems in the long run. It can be difficult to build good credit without a credit card — and not establishing credit affects your ability to borrow money for bigger purchases, like a home.

Miranda ran into this problem when he was looking to buy his first apartment. "Even though I had enough money in the bank, I didn't have sufficient credit history to purchase my first apartment," he tells Morgan Stanley. "My father had to help me buy it by co-signing the mortgage."

Looking back, "there is so much I wish I knew about money when I was first starting out my adult life, but in particular, the importance of building good credit," Miranda says.

To avoid the mistake Miranda made, start building credit by selecting a good credit card. Then, focus on establishing smart credit card habits, such as paying off your balance in full each month. And remember, just because you have a credit card doesn't mean you have to use it all the time.

Now see: A new way for grads to build good credit

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Making the most of credit card perks
Making the most of credit card perks