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3 important facts for young people should know about credit

Updated on April 9, 2016

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3 important facts for young people should know about credit

Your credit has the potential to be checked regularly when applying for an apartment, apply for a job or promotion, apply for a mobile phone, apply for a loan or credit card, open a new utility account and even when you take out car insurance. So check these 3 important credit facts below to get you moving in the right direction during your travel credit lifecycle.

Your loan is your responsibility

There are many laws, both federal and state that exist to protect your rights when it comes to your credit. Head of all credit protection laws known as the fair credit reporting Act (FCRA). In addition to establishing strict rules and regulations that credit reporting agencies (Trans Union, Equifax and Experian) and your creditors should the following when reporting credit information about you, the FCRA also gives you the right to expect accurate and error-free credit reports. However, just because you have this right does not mean that the loan no errors occur.

As 1 in 5 consumers has a bug on their credit reports, according to a study conducted by 2013 the Federal Trade Commission. Yes, the FCRA give you the right to dispute errors when they occur, but still it is important to understand that the responsibility to check your credit reports for errors rests on your shoulders. Fortunately you can and should get access to completely free every 12 months at www.AnnualCreditReport.com. Furthermore, it is probably a good idea to sign up for a free or paid credit monitoring services to keep an eye on your credit report more often 3 credit reports. Your credit is so important to your financial good, that you should develop the habit of keeping a close eye on your credit reports, starting right now.

Fact: credit reporting agencies not required for correcting errors on your credit reports if you notify them of errors/sec.

Credit cards are not evil

It's no secret that many young adults have an aversion to credit card accounts. In fact, some studies show as many as 60% plus Millennials between the ages 18-29 have no credit cards at all. However, assuming that credit cards are evil and must be essentially avoid this gross error in judgment.

In fact, the credit card itself is nothing more than a tool-a tool that you have the ability to control and that has the potential to help you establish a solid credit scores if used correctly. In addition to their credit, capacity-building, credit cards are also much safer than cash or debit cards because of the extensive fraud protection that you are given when you use credit card bills.

If you lose your cash or your wallet stolen then you are out of luck without a way to recover lost funds. If a scam artist steals data debit card, you may be without access to your own personal funds for a few days (or more) while you wait for the Bank to investigate fraud allegations. However, if a fraudster steals your credit card account information, then this money Bank, not your personal funds, which tied up while the Bank clears the mess caused by the thief and removes fraudulent payments from your account history. Credit cards offer protections that simply can't compete with any other payment method.

FACT: credit card is one of the only two extensions of credit where debt is optional. When you open a mortgage, student loan, auto loan, or any other loan you immediately in debt. When you open a credit card account you don't have anyone a dime. Another account, where debt is optional is a home equity line of credit.
Credit card debt can be a problem

It is true that credit card debt absolutely can cause large-scale financial problems. When you use a credit card account, it is important to develop and stick to a habit of charging only so much, how can you afford to pay before the due date. It is prudent to think about your credit card the same way you would think of a debit card. If you do not have an actual, physical funds available in your bank account to spend then you should not make charges on your credit card account, you will be unable to pay in full.

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