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How to Build Credit at 18

Last Updated: January 10, 2024
6 min read

Key points about: the do's and don'ts of building credit as an 18-year-old

  1. Building your credit at 18 may improve your ability to rent an apartment, get car insurance, and qualify for loans.

  2. Eighteen is the age you become eligible to open your own credit card account.

  3. You can learn how to build credit at 18 by learning what mistakes to avoid, like paying your bills late and overspending.

The freedom of adulthood can be exciting, but you may want to consider the importance of financial freedom, which involves your credit. Eighteen is the earliest age you can apply for credit in your own name, so it’s helpful to learn the best ways to build credit.

Building credit at 18 may help you get loans, credit cards, and better interest rates in the future. Your credit history can even affect your ability to rent an apartment, get car insurance, or sign up for a cellphone plan.

Learn how to build credit at 18 by identifying key strategies and common mistakes.

The basics of building credit

You can’t learn how to build credit at 18 without understanding some of the key elements of credit. At its most basic, building credit requires borrowing and repaying money from lenders over time. That’s also how you build a credit history, which is the record of your borrowing activity, on-time payments, and other details reported by lenders. That information gets added to your credit report and converted into a three-digit credit score, which lenders may use to decide if you’re a responsible borrower who’s likely to pay them back on time.

To establish credit history, you need an account with a lender who reports your activity to a credit bureau. This can include a credit card you’re an authorized user for, as long as the issuer reports activity to the credit bureau in your name. Once you have an account, it can take up to six months for the bureau to use it to generate a credit score, according to Experian®.

Advantages of building credit at 18

Establishing credit can be helpful in ways you might not expect. For example, some employers and landlords may require a credit check. Even cellphone companies may want you to have a good credit history to qualify for certain cellphone plans.

Another benefit to building credit at 18 relates to the length of your credit history, a factor in building strong credit. The earlier you start building credit, the sooner you’ll start the clock on your history and enjoy the benefits of good credit.

Strategies for building credit at 18

It may surprise you that you can start building credit as a teenager. These strategies provide steps you can take to move toward financial independence.

Get a secured or student credit card

If you have little to no credit history, a secured credit card can be a great option for a first credit card. A secured card provides a line of credit backed by a deposit. First, your credit issuer approves you for a credit limit. Next, you pay a deposit equal to that credit limit.

Unlike a debit card, a secured credit card allows you to pay with credit. Your purchases don’t come out of your bank account. Instead, you could spend up to your credit limit and make payments toward your account balance, like any other credit card. This helps you build credit history. 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 get your deposit back after 6 consecutive on-time payments and maintaining good status on all your credit accounts.1 Getting a secured credit card at 18 can help you build credit with responsible use, which can also help you later qualify for an unsecured credit card. 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 credit history. However, 18-year-old students usually have to provide proof of consistent income. Some student credit cards, including the Discover It® Student Chrome card, offer opportunities for you to learn healthy credit habits and even earn rewards.

Apply for a student loan

You may consider a student loan if you need more funds for college. The good news is, getting a student loan can help you start building credit history at 18. Not only are you establishing your credit history, but you can also use your student loan to help your credit score by making on-time payments when your loan comes due or even during your grace period. And, if you only have a credit card account, adding a student loan to your credit profile can diversify your credit mix (the unique kinds of credit accounts you have) and potentially affect your credit score.

Become an authorized user

While it may seem counterintuitive to depend on others to gain financial freedom, becoming an authorized user on someone else’s credit card is one way to start building credit. The credit card company won’t require any financial qualifications for you to become an authorized user because the account holder is responsible for submitting payments. As long as the account shows responsible use, with on-time payments and a low balance, the account activity can help you establish a positive credit history if your card issuer reports the activity to credit bureaus under your name. Discover reports account information for authorized users to credit bureaus, but not every card issuer does.

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

Check your credit score

No matter how you build credit, monitoring your progress by checking your credit score is essential. Beyond just the score, review how you’re doing with the five categories that go into your credit score: payment history, amounts owed, 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. Most credit card companies provide cardmembers with free access to credit scores. With a Discover credit card, you can get your FICO® Credit Score for free on monthly statements, 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

It may be easy to 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 can set you back, especially if you’re building your credit from scratch. That’s why paying your credit card bill and other loans on time is imperative. It signals to creditors that you’re responsible with credit and might be able to handle more.


Spending more than you can afford hurts your credit if it makes you miss payments or carry high balances. Budgeting can help you avoid unnecessary debt. Fortunately, creating a budget is not as complicated as you might expect. Consider the 50-30-20 Rule, which provides the framework for prioritizing necessities over nonessentials.

Too many credit inquiries

While getting a credit card may be a good way to build credit, applying for too many credit cards can have the opposite effect. When you apply for a credit card, a lender may make a hard inquiry to check your credit, which can stay on your credit report for up to two years. Too many hard inquiries in a short time (by applying for a lot of cards at once, for example) may negatively impact your credit score and indicate to lenders that you need help managing your finances. As a result, you may be viewed as high-risk and have difficulty getting approved for credit in the future.

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 can impact your credit in a few ways:

  • The mounting debt can be hard to pay down and lead to late payments. Late payments can negatively impact your payment history and impact your credit score.
  • Carrying a high balance impacts your credit utilization ratio (how much of your overall available credit is in use). A high credit utilization ratio can also impact your credit score.

Building Credit Beyond 18

You can start building credit at 18 and sometimes even earlier, but maintaining good credit is a lifelong process. Your credit isn’t something you can establish overnight. It takes years of responsible financial management. But using the strategies outlined here can help you jump-start your credit history.

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  1. Graduation Transparency (Secured CLI): Monthly reviews start your seventh month as a customer. We will refund your security deposit if you have made all payments on time for the last six consecutive billing cycles on all your Discover accounts including any loans, and you've remained in “good status” on all credit accounts you are responsible for whether they are Discover accounts or not. “Good status” means: (1) your credit report shows no delinquencies, charge-offs, repossessions, or bankruptcies for the six months prior to our review; and (2) your Discover Secured Card is not in a prohibited status at the time of our review, including, but not limited to: closed, revoked, suspended, subject to tax levy, garnishment, deceased, lost/stolen, or fraud. Monthly reviews may be delayed if you change your payment due date. When you qualify to upgrade to a standard, ‘unsecured card’, Discover will also consider you for a credit line increase. We typically process your refund in 2-3 business days based on your delivery preference. If you close your account and pay in full, we’ll return your deposit within two billing cycles plus ten days.
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