Here are two ways to establish a credit history with a credit card:  

1. Open a secured credit card: Open a deposit account for $500 to $1,000. The financial institution secures the credit card balance with your deposited amount and gives you a credit limit up to that amount. Keep this secured credit card for at least 12 months.  

At IAA Credit Union, we offer a couple of different free checking account options. Our Dollars & Sense Checking account is exclusively for students ages 13-23. This is a great way for teens to keep their money in a safe place and learn about money management. Our Platinum Checking is available to those who set up a direct deposit of your payroll or retirement check into your IAACU checking account. With each of these accounts, we offer a secure credit card.  

2. Apply for a credit card with a co-signer: A co-signer agrees to pay your debt if you are unable to do so yourself. Since co-signing a credit card affects the co-signer’s credit score, it’s important that you use the card responsibly and don’t abuse this assistance. Keep the co-signer on the credit card agreement for no more than 12 months. To remove them from the agreement, you may need to cancel the card. Check with the credit card issuer for details.  

This is great for students in high school or college who are working part-time jobs. This is another opportunity to teach kids about money management. This also allows students to start to be able to build their credit, which can be beneficial to them later in their life. 
  

Once you’ve established credit, it’s important to manage your debt. To do so:  

• Review credit card statements every month.  

• If you carry a balance on the card, review how much interest you are paying. 

• Use it only for emergencies or recurring payments, such as utility bills or fixed expenses.