Gen Z are known for their upbeat energy and taking on new things to the next level. But, when it comes to finances, they're picky with what to do and what not
to do. So while building your credit score, you as a Gen Z need to take care of a lot of things so that it won't come back to bite you later.
1. Responsible borrowing
As a new user with a regular flow of income and no past credit records to analyse your behaviour, you have a clean slate to start with. So you need to be vigilant while borrowing any loans or credit cards. Because issuing a lot of credit cards or getting too many loans might appear attractive at first, but if you're not able to pay your bills every month, interest starts accumulating, and it burrows deep in the rabbit hole. All this results in a poor credit record and a low credit score.
So, what you've learnt from it, not to get cards or loans just for the sake of the low interest rate of special offers, you need to see if there is a need for it or not.
2. Check your credit report
Regularly keeping track of your credit report is a healthy habit; this helps you detect any errors in your report and see which loans or credit cards are affecting your credit health negatively. In case you see any errors in your credit report, you can raise a dispute with the credit bureau and get it corrected.
3. Take help from a co-borrower
Want to build a healthy credit record and not sure if you're capable of handling loan EMIs, don't worry, you can borrow it jointly with your parents, spouse or any acquaintance of eligible age. How does it benefit your score? You can build a good track record with timely EMI payments. In case you're not able to pay the EMI, the co-borrower will take over and pay the remaining amount. This will secure your credit score from being negatively affected.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
