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How Recent Graduates Can Build Their Credit Scores

India Graduates Improving CIBIL Score
Viveka Rao
Written by Viveka Rao

Your Exam Scores Were High, But Is Your CIBIL Score?

CIBIL Scores and Student LoansHave you just finished with your college years and looking for ways to build your CIBIL score? Then, this is the right place for you.

Building your credit score in your post-graduation years is not as difficult as it seems to be. One of the crucial things for a fresh graduate who is preparing to step into adulthood is to become financially independent. Now is the time, when you should think about earning money and stop relying on your parents for your pocket money.

After all, you are an adult now. It is time that you should learn about your responsibilities, including financial ones. If you are planning to work part time during your post-graduation years, then it is imperative that you take care of your finances. You must get your finance basics right, among which one of the important things is your credit score.

Building CIBIL score from scratch in your early years is a nice idea, since it helps you to build a strong base for your credit history. The more soon you start working on your credit score, the sooner you will be able to build high CIBIL score. Have a look at the ways through which you as a graduate can build your CIBIL score.

Take a student loan

If you are planning to go for higher studies in your hometown or abroad, figure out how you will pay the fees of your institute. Our advice is to take a student loan, instead of making a dent in the savings of your parents. You can get a student loan through your parents’ well-maintained and good CIBIL score.

Since you do not have a credit history of your own, you will require the credit score of your parents. And after you get the loan, make sure that you are frugal with your expenditure and try to save up as much as you can during your academic years, so that you can easily and quickly pay back your student loan later on.

You can also take up a part time job, while you do your post-graduation in order to augment your nest egg and pay off your student loan sooner. And, once you finish with your studies and grab a full time job, try to pay back your loan as quickly as possible.

This will give a good kick to your credit score as well as make you free of debt. Moreover, paying your student loan before time means that you are on the right track to build an above average CIBIL score, thus making it easy for you to take credit later on in your life.

Obtain your own credit card

Working part time for graduates in post-graduation years is not just for fun anymore; in fact it is a necessity nowadays. Therefore, you too must take up a part time job along with your studies. And, once you start earning part time, get your own credit card. And, this does not mean using an add-on credit card of your working parent; it means getting your own.

A credit card will not only help you to build your credit history from scratch, but it will also teach you how to manage your finances responsibly. Getting a credit card is easy, but the tough thing is to use it wisely. Ensure that you do not exceed your credit limit, pay the credit bills on time in full, and use it only for particular purchases. Know your spending limits and do not spend excessively.

Besides this, do not go for the first card that you come across, even if it promises to give an attractive offer. Conduct your research on the internet and explore the various benefits and features of different credit cards. Then, compare these cards on several parameters, like interest rates, reward points, annual fees, etc. This will help you to get a credit card that best suits your personal requirements.

So, use these tricks in order to build your credit score after you graduate. A good CIBIL score will, in turn, help you later on in your life, when you want to avail a loan or get credit. The more early you start working towards your credit score, the earlier you will become financially healthy!

About the author

Viveka Rao

Viveka Rao

Viveka Rao is post grad in finance and a freelance writer here at CreditSmart. A love for shopping and travel rewards has fueled her interest in personal credit, and making the most of rewards programs. She writes to educate other consumers in making great financial choices.

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