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Plan Well, Retire Well

Saving and investing your money

Checking my credit report -- oops!

In the last Plan Well, Retire Well blog post Karen talked about how to access your credit report online. Well, sometimes when we check our reports we discover interesting things!

Some young adults may find that they don't have much of a credit history. If this is you, you may want to consider applying for a credit card -- and using it wisely -- in order to establish a credit history. However, with today's tight credit market, I'm hearing from many 20 year olds that they're having trouble being approved for a credit card. Here are some options to consider if you're turned down for a credit card:
  • apply for a credit card from a different financial institution;
  • apply for a credit card at a store that you like to shop at;
  • if you have a phone or utility bill, be sure that it is in your name (and not always in your roommate's name);
  • consider asking your parents to co-sign on a loan; or
  • ask your financial institution about a secured credit card.
Others who check their credit report may find that they need to improve their credit history. Remember, a poor credit history can affect your life in many ways including insurance rates, car loan interest rates, and utility deposits. Here are three important steps that you can take:

1. Always pay as agreed.

Make at least the minimum payment due each month and never be late. Delinquent payments and payments that don't meet at least the minimum contractual amount will have the most immediate, negative impact on your credit report and credit scores.

2. Keep your balances low.

Keeping your balances low as compared to your available credit limits is a sign of good credit management and shows lenders you are a good credit risk. Your utilization rate, also called your balance?to?limit ratio is a key component to credit scores.

3. Apply for credit wisely.

Do not apply for multiple accounts in a short period of time. Taking on large amounts of debt in a short time is a sign of high credit risk. Apply for credit when you need it, and only in the amount you need. Just because credit is offered, doesn't mean you have to accept it.

If you have information on your credit report that is wrong, you have the right to have it corrected. Follow the instructions given in the credit report to correct inaccurate information. Keep written documentation of information you send to the credit bureaus.

Remember to check your credit report annually, go to

For more information on managing your credit history and credit cards, go to University of Illinois Extension's website, Credit Card Smarts

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