When Cole Edwards and his longtime girlfriend were ready to take the next step after college graduation, he was thankful that he'd put in the effort to build good credit. It made it possible to finance an engagement ring at 0 percent interest with a good credit card.
"I knew the timing was right after dating for four years," says Edwards, 24, who graduated from Virginia Tech in 2014. "The payments gave me the flexibility to propose now."
Building credit is an essential step in everyone's financial life. It's possible to get by without good credit, and it may even seem unnecessary when you're just starting out, but you'll find that it matters when it comes time to get a car loan, mortgage or other financing. Your credit will affect the loan terms you get — and whether you get approved at all. It can even help you land an apartment or a job, since landlords and employers commonly check credit reports.
The quickest and easiest way to build credit is with a credit card, used responsibly. But it's not as easy for young adults to get a credit card as it was in the past. You may need to hitch yourself to someone's good credit to start the clock on your credit history.