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How to Build Credit at 18

10 min read

Last Updated: September 30, 2025

Table of contents

Key Takeaways

It may be easier to rent an apartment, get car insurance, and qualify for loans if you start to build your credit at 18.
You may be eligible to open your own credit card account when you turn 18.
Knowing what mistakes to avoid may help you build good credit.

The freedom of adulthood can be exciting, but it’s important to prepare for the responsibilities of financial freedom, such as managing your credit. Building a good credit history may help you rent an apartment, get car insurance, or sign up for a phone plan.

A good credit score may also improve your odds of a lender approving your application for a personal loan, credit card, or auto loan. Plus, you may get a better interest rate on these loan products.

You may typically begin applying for credit in your own name at age 18, so it’s helpful to learn the best ways to build excellent credit early.

The basics of building credit

Understanding the fundamentals of credit may equip you to build a good credit score. In simple terms, having good credit means you’ve established a history of repaying the money that you’ve borrowed from lenders, like credit cards, student loans, auto loans, personal loans, and more.

You won’t have a credit score until you open a credit account. When you open a credit card account or take out a loan, the lender—such as a bank, credit card issuer, or credit union—typically reports this to a major credit bureau (also known as a credit reporting agency). The credit bureau records your financial activity, including payments and balances, and creates a credit report. That information then gets converted into a three-digit credit score. Lenders use your credit score to predict whether you’re likely to manage your debt responsibly and pay it back.

It may take up to six months after you open your first credit account for a credit reporting agency to have enough information to generate your initial credit score.

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Advantages of building credit at 18

A good credit score may help you in unexpected ways. For example, some employers may conduct a credit check before offering you a job. Some landlords only rent apartments to people with good or excellent credit scores. You may even need a good credit score to qualify for certain mobile plans.

Building credit early may also help you qualify for more credit later because it gives you a longer credit history, which is an important factor in your credit score. The earlier you start building credit, the sooner you’ll enjoy the benefits of good credit.

Strategies to build credit at 18

There are a few ways to begin building credit as a teenager that may help you move toward financial independence. These include opening a credit card, taking out a student loan, or becoming an authorized user on someone else’s card.

Get a secured or student credit card

If you have little to no credit history, a secured credit card may be a great option for your first credit card.

Secured credit cards provide a line of credit backed by cash that you provide up front. If a credit card issuer approves your application for a secured card, you may open an account by providing a deposit. Typically, your credit limit equals that deposit amount.

Secured credit cards don’t work like debit cards. Your secured card purchases don’t come out of your bank account or your deposit. Like an unsecured credit card, a secured card offers access to a set credit limit. You may charge up to your credit limit and make payments toward your account balance.

Once your credit card company reports your activity to a major credit bureau, your activity will appear on your credit report.

Keep in mind that your credit card issuer can keep your deposit if you don’t pay your bill. With a Discover it^® Secured Credit Card, you can get your deposit back after six consecutive months of on-time payments and maintaining good status on all your credit accounts.¹

If you use a secured credit card wisely, you might establish stronger credit, which may also help you qualify for an unsecured credit card later. Consider looking for a secured credit card with no annual fees and cash back rewards.

Did you know?

Student credit cards are ideal for college students with limited incomes and credit histories. Some student credit cards, including the Discover It^® Student Chrome card, offer opportunities for you to learn healthy credit habits.

Learn More

Apply for a student loan

Student loans are a common way to cover college costs. Like a credit card, a student loan may help you establish your credit history early. When it’s time to start repaying your loan, on-time payments may also help improve your credit score.

If you only have a credit card account, adding a student loan to your credit profile may diversify your credit mix, which might boost your score. A student loan is a type of installment loan, while a credit card is a type of revolving credit. Ideally, your credit mix should feature both revolving credit and installment credit, which could also be car loan or any personal loan.

Become an authorized user

It may seem counterintuitive to use someone else’s credit card account to build your own credit history, but becoming an authorized user may help you do just that. When you become an authorized user on someone else’s credit card, the activity on their account becomes part of your own credit history.

As an authorized user, you typically receive a credit card with your name on it and access to the credit limit. But the primary account holder is responsible for making payments and managing the account.

Before becoming an authorized user, make sure the primary account holder has excellent credit habits. If they miss a payment or carry a high balance, your credit score may suffer. Likewise, if you keep a high balance on the account, you may hurt the primary account holder’s credit.

Discover^® reports account activity for authorized users to credit bureaus, but not every card issuer does. If your card issuer reports all the account activity to credit reporting agencies under your name, becoming an authorized user may help you establish a credit history.

Although you must be 18 to open your own credit account, some credit card issuers may allow authorized users under 18. Discover allows people to become authorized users starting at age 15.

Make on-time payments to help build credit

Your payment history is the most influential contributing factor to your credit score. You may steadily build your credit score by simply paying your bills on time each month.

If you have a credit card, consider using it for a small, consistent purchase each month, like a streaming subscription. Then, pay off your credit card balance with your debit card by the due date. You may even be able to set up automatic bill payments to pull your payments from your bank account every month. Just make sure you always have enough to cover the payment, so you don’t overdraw your account.

Keep your credit utilization rate low

Your credit utilization rate also has a major impact on your credit score. You may find your credit utilization rate by comparing your outstanding balances to your overall available credit on your revolving accounts. For example, if you have $1,000 in available credit and your balance is $200, you have a 20% credit utilization ratio.

To build a positive credit history, try to keep your credit utilization to a minimum. Whenever possible, repay your monthly balance in full. That way, you won’t have to worry about interest charges further increasing your balance.

Check your credit score

No matter how you build credit, monitoring your progress by checking your credit score is essential. You should also review how you’re doing with the five categories that go into your credit score: payment history, amounts owed (also called credit utilization), length of credit history, new credit, and credit mix. And remember that credit scores fluctuate. Your score will likely go up and down over time.

Checking your credit score is easy and often free. Many credit card companies provide cardmembers with free access to credit scores. With a Discover^® credit card, stay on top of your recent FICO^® Credit Scores for free on mobile and online.²

What not to do when building credit

One of the keys to building credit at 18 is knowing what not to do. Avoid these common mistakes:

Late payments

You might think that paying late or missing a credit card payment here or there won’t matter, but your payment history is the most significant contributing factor to your credit score.

Every late payment risks setting you back. This is especially true if you’re building your credit from scratch. On-time payments signal to creditors that you’re responsible with credit and might be able to handle more. Late or missed payments, on the other hand, indicate that you may not repay the money you borrow.

Consider using your mobile app alerts to remind you about payment due dates.

Overspending

While it may be tempting to splurge with your new card, you should try to stick to a budget. Spending more than you can afford may lead to carrying a high balance or even missing payments.

A thoughtful budget may help you avoid unnecessary debt. Fortunately, creating a budget is not as complicated as you might expect. Consider the 50-30-20 rule, a framework that directs 50% of your income toward necessities, 30% toward non-essentials, and 20% toward savings or repaying debts.

Too many credit inquiries

While getting a credit card may be a good way to build credit, applying for too many credit cards at once can have the opposite effect. When you apply for a credit card, a credit card issuer typically conducts a hard inquiry to access your full credit file. Hard inquiries may stay on your credit report for up to two years. Too many hard inquiries in a short time may indicate to lenders that you need help managing your finances. As a result, lenders may view you as a high-risk borrower, and credit approval might become difficult.

High credit card balance

If you’re trying to build your credit, it’s a good idea to keep your credit card balance low or pay it off entirely each month. Carrying a high balance on your credit card may impact you in a few ways:

The mounting debt due to interest fees may be hard to pay down and lead to late payments.
Carrying a high balance increases your credit utilization ratio. High credit utilization may bring down your credit score.

The bottom line

Your credit isn’t something you can establish overnight. You may start building credit at 18 and sometimes even earlier, but maintaining good credit takes years of responsible financial management. Using the strategies outlined here may help you jump-start your credit history and build good credit habits that may benefit you in the long run.

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