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[ad_1] The IRS processes huge amounts of data and documents each year. In 2021 alone, it processed more than 261 million tax returns and documents to supplement tax returns. That includes more than 83.9 million individual electronic tax returns. One of the best ways you can make sure your tax return makes it through IRS processes unscathed is by preparing for tax season. When you have the information you need and are ready to file your return as early as possible, you increase your chances of getting a fast refund. It’s important to prepare for tax season whether you’re planning to work with a tax pro or file your taxes on your own. Find out more about preparing for tax season below. We’ve got 10 steps you may want to consider following. In This Piece Know When You Can Start Paying Taxes Gather Important Documents Gather Information About Dependents Double-Check Personal Info With Your Employer Plan Ahead to Pay Taxes Plan Ahead to Practice Good Financial Habits with Potential Tax Refunds Renew Your ITIN Start Preparing Your Return Research Professional Tax Preparers Consider Planning for the Future 1. Know When You Can Start Paying Taxes If you owe taxes, you definitely need to know when to pay them. The IRS notes that you’re supposed to pay around 90% of your taxes throughout the year via withholdings on your paycheck or estimated quarterly tax payments. As far as returns go, the IRS started accepting 2022 tax returns on January 23, 2023.   2. Gather Important Documents Taxes require a great deal of paperwork. Get organized by gathering those documents as soon as possible. You can create a folder or basket where you store documents until you’re ready to use them. Because many tax documents, including W-2s and 1099s, might come electronically, create a digital folder where you can store those documents or be prepared to print physical copies for your basket.  Common documents you might need to file your taxes include but aren’t limited to: W-2s from employers 1099s from anyone who paid you miscellaneous, contract, or other relevant funds Documents showing medical, educational, childcare, or other expenses, especially if you’re itemizing  Statements regarding investments or mortgage interest payments Receipts You don’t have to keep every receipt throughout the year. You’ll need receipts to document deductible expenses, though, including charitable deductions. If the IRS ever audits you, they won’t just take your word for it.  3. Gather Information About Dependents You’ll need the names and Social Security numbers of any dependents you include on your tax return. If someone else can or might claim one of your dependents on their return, you need to know that. For example, if you’re divorced, it might be a good idea to work out which parent will claim a child or children for the 2022 tax year. You can’t both claim the same child for the same tax year. 4. Double-Check Personal Info With Your Employer Filing your tax return as soon as possible after the IRS starts processing returns can be a way to get a refund sooner—and avoid potential taxpayer identity theft. But you’re often at the mercy of employers and other institutions. Employers must send W-2s by the last day of January each year. Whether your employer sends your W-2 early or waits until the last day, you could receive it late if your employer doesn’t have the right address. To avoid this issue, check with HR to make sure all your information is up to date. This is actually a good exercise to practice with other businesses in December as well. Whether it’s a bank, your IRA provider or your child’s school, if someone is likely to send you tax documents, make sure they have your correct address. 5. Plan Ahead to Pay Taxes If you fall behind on tax payments, you could pay high penalties and interest. You might also put yourself at risk for IRS collection methods, which can include tax liens and levies.  One of the best ways to keep yourself from becoming delinquent is to plan ahead if you think you might owe taxes. Here are a few tips for doing so: Start a savings account to pay for your taxes. If you put money away starting as early as December, you can break a tax debt into smaller chunks and have enough to cover it by the April deadline. Consider maximizing contributions and charitable donations to reduce your taxable income. This might lower the total amount you owe. Consider consulting with a professional tax attorney or accountant to find out if you can reduce your tax burden in other ways. For most people, the deadline to pay federal personal income taxes for the 2022 tax year is April 18, 2023. However, the IRS did create an extension for those in disaster areas in California, Alabama, and Georgia. Individuals in these qualifying areas have until October 16, 2023, to pay taxes. 6. Plan Ahead to Practice Good Financial Habits with Potential Tax Refunds It’s a good idea to be prepared to practice good financial habits with any resources you get from your tax refund. Take some time to consider your budget, debt, and financial goals. Make a plan to use your tax refund to pay down debt, establish stronger savings, make an important purchase, or start investing. That way, you don’t spend it all quickly and without much to show for it at the end of April.  7. Renew Your ITIN If you use an Individual Taxpayer Identification Number to file your taxes and haven’t used it at least once in the past 3 years, it expires at the end of December the following year. That means if you didn’t use the ITIN on your 2019, 2020, or 2021 return, it will expire before you use it on the 2022 return. If your ITIN has middle digits of 88, 90, 91, 92, 94, 95, 96, 97, 98, or 99 and you haven’t taken action to renew it, it’s also expired. You’ll need to renew your ITIN, but you can

[ad_1] Do you think it’s possible someone stole your tax refund check? You wouldn’t be alone. In 2020, just under 1.4 million people reported cases of identity theft, and around 400,000 of those involved the theft of government benefits or documents—including tax refunds. The issue was concerning enough that the IRS started what it calls Identity Theft Central to provide information about identity theft. Find out how identity theft happens below. Then learn what action you should take if you believe your tax refund was stolen. How Does Identity Theft Happen? Identity theft occurs when someone gathers enough information about you that they can impersonate you to a sufficient degree to commit fraud. For example, if someone gets enough of your sensitive personal information, they can apply for credit cards in your name. They receive the cards after approval, run up balances and never pay them because the account is all in your name.  Another version of identity theft occurs when someone has enough information to file a fake tax return in your name. They get a refund in your name, and when you go to file your legitimate tax return, you find you can’t get a refund. Someone stole it out from under you. Some methods people use to get the information required to commit identity theft include: Imposter scams. The scammers email, call or otherwise contact you while pretending to be someone else, such as the IRS. They use that contact to try to get personal information out of you. Social media scams. Scammers comb social media, looking for personal information people might have shared. They also use direct messages to try to get information from you. Dark web databases. If your information is included in a data breach, it may be shared or sold to scammers online. Checking your trash. In some cases, scammers simply go through unshredded documents in the garbage to get the information they need. When someone uses information in this way to file a fake tax return, it’s a crime called Stolen Identity Refund Fraud. There are serious penalties for this crime. It’s always best to safeguard your private information as much as possible to reduce your risk of becoming a victim.  How to Know if Your Tax Refund Was Stolen The IRS provides a tool called Where’s My Refund? that lets you track the status of your refund. If you’re worried someone has filed a fake return in your name or tried to steal your refund check, use that tool to see what’s going on with your refund. You can also ask the IRS to do a refund trace to find out more about where the tax refund check or deposit went. The IRS will also notify you when more than one return is filed in your name for a particular year. If you file a tax return and receive this notice, there’s a good chance some fraud has occurred.  Important Steps to Take after Tax Refund Fraud If you’ve received a notice from the IRS stating that more than one return has been filed in your name, or if you believe your identity has been used fraudulently, you should act quickly. Follow the steps below.  1. Report the Fraud If your Social Security number was compromised and you think you may be the victim of tax-related identity theft, file a report with your local police and file a complaint with the Federal Trade Commission at www.identitytheft.gov or by calling the FTC Identity Theft Hotline at 1-877-438-4338. 2. File a Report With the IRS Once you’ve filed a police report, file an IRS Form 14039 Identity Theft Affidavit.  Print the form and mail or fax it according to the instructions. 3. Pay Your Taxes Be sure to continue to pay your taxes and file your tax return on time, even if you must do so by mailing in paper forms. 4. Check Your Credit Reports and Scores Just because you were first alerted to the problem through a false tax return doesn’t mean that’s where the ID theft started.  A sudden drop in credit scores can be a sign your identity has been stolen. You should also monitor your credit reports for activity that isn’t yours. You can get a free copy of your credit report from each of the major credit bureaus at AnnualCreditReport.com. You can also check 28 of your FICO scores and get regularly updated information about your credit reports and scores when you sign up for ExtraCredit. 5. Add Fraud Alerts to Your Credit Reports Contact each credit bureau and add a fraud alert to your credit report. You can do this online or via phone. A fraud alert makes it harder for someone to apply for credit in your name. 6. Close Any Fraudulent Accounts Reach out to creditors to close any accounts opened in your name fraudulently. You should also report them as fraudulent to the banks and lenders.  7. Change All Your Passwords Thieves know people use the same password for multiple websites and accounts. Change all your passwords immediately if you believe you’re the victim of identity theft or fraud. It’s also a good idea to change your passwords regularly, even if you aren’t a victim of identity theft.  8. Follow Up on Your Case If you informed the IRS about taxpayer ID theft and didn’t receive a resolution, contact the Identity Protection Specialized Unit at 1-800-908-4490 about your case. If you’re experiencing financial difficulties because of the delay, you can reach out to the taxpayer advocate service, an independent organization within the IRS, at 877-777-4778.  9. Stay Calm & Be Patient A typical case of ID theft can take an average of 120 days to resolve, according to the IRS. Remember that the average might not reflect your case, and it could take a year or more to resolve it. Just remember, the IRS will eventually pay you your refund, but if you’re experiencing financial difficulties because of the delay, you can contact the taxpayer advocate service, an independent organization within the

[ad_1] Key takeaways: Net worth is one of the metrics that shows a person or household’s overall wealth The average American net worth is $748,000, but the median for households is $121,700 Americans 65 to 74 have the highest average net worth at $1,217,700 Those with a college degree have the highest net worth compared to those without one The median net worth for White Americans is seven times higher than Black Americans The Federal Reserve conducts a survey every few years to see where Americans stand financially. As of 2019, they found that the average American net worth was $748,000. The median net worth for American households was $121,700 during this same time. So, where do you stand? Knowing your net worth and how you compare to other Americans can be a good way to see where you stand financially and how secure you are in your future. Here, we’ll go over the average American net worth by age, education, household type, and more. This will give you a rough idea of how you compare, and then we’ll give some actionable tips you can use to increase your net worth and improve your financial well-being. Table of contents: What is a net worth? Key American net worth statistics Average net worth by age Average net worth by education level Average net worth by housing status Average net worth by family structure Average net worth by state Average net worth by race Average net worth by location How to increase your net worth Why your net worth matters What Is Net Worth? Your net worth is comprised of your assets and your liabilities. Your assets include anything you own that’s worth money, which includes the following: Checking and savings account funds Investment accounts Retirement accounts Stocks and bonds Vehicles and homes you own Liabilities are your debts, such as: Bank debt Credit card debt Mortgage loan Vehicle loan Student loan debt Key American net worth statistics How much you save and invest aren’t the only contributing factors to your net worth. Here are some of the key findings and factors for the average net worth of Americans as reported by the Federal Reserve. Average net worth by age As of 2019, the median net worth of Americans was $121,700 and the mean was $748,800. The median is the main number to look at because it helps separate outliers. For example, if you had $100 and someone had $5, the average (or mean) would be $52, but that’s not an accurate picture because the person with $5 is so far from that average number. With net worth, the median helps separate the extremely wealthy from the average American. Here, we’ve listed both the mean and median net worth of Americans by age: Age group Median net worth Mean net worth Under 35 $13,900 $76,300 35 to 44 $91,300 $436,200 45 to 54 $168,600 $833,200 55 to 64 $212,500 $1,175,900 65 to 74 $266,400 $1,217,700 75 and older $254,800 $977,600 What’s a good net worth for your age group? While you might be looking to increase your net worth, it’s helpful to remember that everyone’s situation and goals are different. Your ideal net worth should be the amount you need to have to live comfortably and pursue the activities that you enjoy. As we’ll cover in upcoming sections, education, family structure, race, and more all statistically influence net worth. In fact, Georgetown University published a study showing that one of the primary predictors of wealth was being born into a family with a high socioeconomic status (SES). The report found that these children often receive the material support they need to increase their scores, earn college degrees, and work in good entry-level jobs as young adults. Average net worth by education level Education is one of the primary predictors of wealth in America, and those with a college degree have a median net worth of over 1,400 percent more than those without a high school degree. These individuals also have a median net worth of $219,400 more than those who only have some college. Education level Median net worth Mean net worth No high school diploma $20,500 $137,800 High school diploma $74,000 $305,200 Some college $88,800 $376,400 College degree $308,200 $1,519,900 Average net worth by housing status Owning a home is one of the primary ways that people increase their net worth. In fact, many people buy homes as an investment. With every renovation, the value of a home typically increases, depending on the economy. During times when the housing market is performing well, a person’s net worth can grow significantly with homeownership. Housing status Median net worth Mean net worth Renter or other $6,300 $95,600 Homeowner $255,000 $1,102,100 Homeowners have a median net worth of nearly $250,000 more than renters. To buy a home, you need a quality credit score as well as the funds for a down payment.  Average net worth by family structure The Federal Reserve charts how different family structures vary in net worth as well, and it shows that couples without children have a significantly higher net worth than single Americans. This makes sense because these are typically dual-income households without the additional expenses of raising children. Family structure Median net worth Mean net worth Single (less than 55 years old), no child $15,700 $131,760 Single with child(ren) $36,710 $284,620 Single (55 years or older), no child $119,500 $444,900 Couple with child(ren) $166,300 $879,210 Couple, no child $251,700 $1,314,550 Average net worth by state Empower recently ran a survey of their users to discover the average net worth from state to state. Currently, California has the highest average net worth at $884,003, followed by Connecticut and Washington, which are at $873,746 and $865,309, respectively. The state with the lowest average net worth is North Dakota at $339,955. In a section on why some states rank high or low, Todd Burnaford at Empower says, “Not surprisingly, some of the states with the largest numbers of millionaire households

[ad_1] If you want to save money on apartment rent, you may be in luck this year. Apartment rental prices have dropped in every major metropolitan area in the United States over the last seven months, after surging for much of the past two years according to data from Apartment List. In fact, August 2022 to … Renting? Now May Be a Good Time to Move (or Renegotiate Your Lease) Read More » If you want to save money on apartment rent, you may be in luck this year. Learn why apartment rents are dropping around the country, and what you can do to secure a lower rent price with our blog post. The post Renting? Now May Be a Good Time to Move (or Renegotiate Your Lease) appeared first on ScoreSense. [ad_2]

[ad_1] Buying a used car can lower the cost of your purchase, letting you move into car ownership with a much smaller loan. This might also be beneficial if you don’t have the credit or income to qualify for a loan amount that would cover a new car price. You might get an even better deal if you buy a used car through a private seller. However, it’s important to ensure you’re protected from scams and engaging in a safe transaction.  This piece covers how to buy a used car from a private seller. That includes how to get a loan for a used car from a private seller.  In This Piece How to Buy a Car From a Private Seller Shop Around for Local Deals Contact the Seller Complete the Sale Complete the Paperwork How to Buy a Car From a Private Seller When you’re buying a car from a private seller, there are some additional concerns you may not have when buying a vehicle from a dealership. Private sellers don’t have consumer reviews and brand reputation you can consider. So, you have to do some legwork to ensure you’re getting a good deal and aren’t getting scammed. Follow the steps below to buy a car from a private seller.   Shop Around for Local Deals Start by understanding what you can afford. If you want to know how to finance a private car sale, start by getting an auto loan first. You can apply for auto loans online or with a local bank. Once you get pre-approved, you know how much used car you can afford.  Not sure if you can get approved for a car loan? Get your credit score first to see your odds of being approved and work toward improving your scores before moving forward with your purchase. Get Your Free Credit Score & Monitoring Plus Weekly Updates From Our 50+ Experts Get It Now Privacy Policy Use your loan pre-approval or cash on hand to set a budget for your car purchase. Avoid going outside that budget so you don’t have a financial hardship once you buy the used car. Start researching cars that fit your needs. Read about cars you’re interested in online, and look into different considerations for older models. This helps you know what type of common issues to look for when you start checking out cars from private sellers. Next, review the cars available from private sellers in your area. You can research options on Facebook marketplace, Auto Trader, eBay and any local classified publications, such as your city’s newspaper. Contact the Seller Once you spot a potential new-to-you ride, start by making contact with the seller. Take some time to feel them out and ensure they’re legitimate. Avoid meeting anyone by yourself or in a location you’re not comfortable with. If the seller is willing to come to a public location with the vehicle, that’s best. If not, take someone with you when you go to their home. Ask to test-drive the vehicle. If you can have a mechanic or someone you trust who knows a lot about cars look over the vehicle, do so. You can also look up the CARFAX report on the vehicle using its VIN. This database and others like it provide some information about the vehicle’s history, including potential accidents, service records and how many owners the vehicle might have had. Once you’re confident you’ve found the vehicle for you, start negotiations.  Complete the Sale Once you and the private seller agree on a price for the vehicle, move forward with the transaction. Make sure you get any agreement in writing to protect yourself in the future. You may also want to pay by check so you have a paper trail demonstrating that money changed hands for the car. Verify ownership documents when you complete the sale. If the individual has the title on hand, they should sign it over to you at that time. If the seller owes money on the car, there’s a lien on the title. You’ll need a bill of sale indicating you paid for the vehicle. The owner will then take your money to their bank to pay off the car so they can get a title to transfer to you. Complete the Paperwork Even if you go through a private seller and not a dealership, buying a car requires lots of paperwork. You’ll need to: Ensure you have a receipt or bill of sale documenting the purchase Get the title from the seller at the time of purchase or after the fact Go to the DMV with the title and ask for a transfer of ownership, which includes the completion of a form and getting a new title At the DMV, you may need to pay tax, title and registration Depending on your state, you may have to pay sales tax on the vehicle purchase  Bottom Line Always have a plan when you’re making large purchases. Create a budget and stick to it to avoid overcommitting yourself financially. Do the research to protect yourself from scammers. If a deal seems too good to be true, it may be. If you need a loan to buy a used car from a private seller, start by comparing auto loan rates. Then, you can prepare yourself with everything you need to help finance your new car. More Money-Saving Reads: What’s a Good Credit Score? What’s a Bad Credit Score? How Credit Impacts Your Day-to-Day Life Article updated. Originally published July 15h, 2015. The post How to Get a Loan for a Used Car From a Private Seller appeared first on Credit.com. [ad_2]

[ad_1]  [Disclosure: Lexington Law Firm advertises on Credit.com and Credit.com may receive compensation if you sign up for credit repair services with Lexington Law Firm.] Your credit score is one of the most important numbers you have. A high score can open doors for you and increase your chances of obtaining the things you want. However, a low credit score can make it nearly impossible for you to secure a loan. Why is credit repair important? Portrait of a professional businessman standing in an office with colleagues in the background Businesses, lenders, landlords and even some employers use your credit score to determine your creditworthiness. The good news is that even if you have a low credit score now, there are steps you can take to improve your score. So, if your credit score isn’t as high as you want it to be, it’s important to start repairing your credit now. Keep reading to find out why credit repair is so important. With a lower credit score, you’ll be slammed with higher interest rates when you apply for a loan or credit card. Repairing your credit can help enable you to qualify for more competitive interest rates, which can save you money. In This Piece  Purchase a Home Rent a Nice Apartment Buy a New Car Get a Better Deal on Car Insurance Reduce Your Stress Level Land a Good Job Get a Credit Card Increase Your Credit Card Limits Say Goodbye to Debt Collectors Obtain a Loan without a Cosigner 10 Reasons Credit Repair Is Important Here’s a look at the top 10 benefits of getting credit repair today. 1. Purchase a Home Do you have a long-term goal of purchasing a home? If so, your credit score is extremely important. Nearly every lender in the country uses credit reports to determine whether they approve a loan application. Don’t risk not being able to turn your dream of homeownership into a reality. Instead, take steps now to boost your credit score so you can buy a home in the future.   2. Rent a Nice Apartment Not interested in buying a home? Even landlords check credit scores. Even though some landlords don’t have the same credit score expectations as mortgage lenders, you still need an average score to find a decent apartment. If you want to have the most options when searching for an apartment, you need to take steps to rebuild your credit. 3. Buy a New Car If you want to purchase a reliable new—or fairly new—car, truck, SUV or motorcycle, you’re going to need an auto loan. Most lenders won’t approve a car loan unless you have good credit. If you don’t work toward building your credit score now, you may be forced to go to a buy here-pay here auto shop that notoriously has higher prices.  This means higher prices for lower-quality cars. 4. Get a Better Deal on Car Insurance You might not realize it, but car insurance companies factor in your credit score when determining your premium rates. The lower your credit score, the higher your auto insurance could be. These insurance companies do this to ensure you’re going to make your payments on time. No matter what your score is, make sure to compare auto insurance rates so you can find the most affordable option. 5. Reduce Your Stress Level According to a recent report, Americans rank finances as their number one stressor. If you’ve had any financial struggles, you know this to be true. Taking the time to repair your credit report and effectively deal with your debt can help alleviate this stress. 6. Land a Good Job Did you know that some employers, especially in professional roles, run credit checks on candidates before making a job offer? These employers are trying to reduce the risk of fraud and embezzlement by making sure the candidate doesn’t have any major financial issues. If you don’t want your lower-than-average credit score to jeopardize your career, take a closer look at your credit report and take steps to improve it. /*Chat Animation*/ #animation-wrapper {max-width: 450px; margin: 0 auto; margin-bottom: 50px;} #animation-wrapper .box {background-color: rgb(44, 74, 94);color: #fff;text-align: center;font-family: “ProximaNova-Regular”, Arial, sans-serif;height: 153px;padding-top: 10px;} .content .box p {margin: 0px 0px;} .box .btn-primary {color: #fff;background-color: #ff7f00;margin: 10px 0px;} .chat ul {margin: 0px;padding: 0px;list-style: none;} .message-left .message-time {display: block;font-size: 12px;text-align: left;padding-left: 30px;padding-top: 4px;color: #ccc;font-family: Courier;} .message-right .message-time {display: block;font-size: 12px;text-align: right;padding-right: 20px;padding-top: 4px;color: #ccc;font-family: Courier;} .message-left {text-align: left;margin-bottom: 16px;} .message-left .message-text {max-width: 80%;display: inline-block;background: #e5e6ea;padding: 13px;font-size: 14px;color: #000;border-radius: 30px;font-weight: 100;line-height: 1.5em;} .message-right {text-align: right;margin-bottom: 16px;} .message-right .message-text {line-height: 1.5em;display: inline-block;background: #5ca6fa;padding: 13px;font-size: 14px;color: #fff;border-radius: 30px;line-height: 1.5em;font-weight: 100;text-align: left;}.chat {border-radius: 30px;background: #fff;} .chat-container {height: 450px;padding-right: 16px;overflow: hidden;} .spinme-right {display: inline-block;padding: 15px 20px;font-size: 14px;border-radius: 30px;line-height: 1.25em;font-weight: 100;opacity: 0.2;} .spinme-left {display: inline-block;padding: 15px 20px;font-size: 14px;color: #ccc;border-radius: 30px;line-height: 1.25em;font-weight: 100;opacity: 0.2;} .spinner {margin: 0;width: 30px;text-align: center;} .spinner > div {width: 10px;height: 10px;border-radius: 100%;display: inline-block;-webkit-animation: sk-bouncedelay 1.4s infinite ease-in-out both;animation: sk-bouncedelay 1.4s infinite ease-in-out both;background: rgba(0,0,0,1);} .spinner .bounce1 {-webkit-animation-delay: -0.32s;animation-delay: -0.32s;} .spinner .bounce2 {-webkit-animation-delay: -0.16s;animation-delay: -0.16s;}@-webkit-keyframes sk-bouncedelay {0%,80%,100%{-webkit-transform: scale(0)}40%{-webkit-transform: scale(1.0)}}@keyframes sk-bouncedelay{0%,80%,100%{-webkit-transform: scale(0);transform: scale(0);}40%{-webkit-transform: scale(1.0);transform: scale(1.0);}} /*Text Ad*/ .ad-container {padding: 15px 30px;background-color: #FFFFFF;max-width: 690px;box-shadow: 1px 1px 4px #888888;margin: 20px auto;} .ad {padding: 10px 6px;max-width: 630px;} .ad-title {font-size: 20px;color: #0077BB;line-height: 22px;margin-bottom: 6px;letter-spacing: -0.32px;} .ad-link {line-height: 18px;padding-left: 26px;position: relative;} .ad-link::before {content: ‘Ad’;color: #006621;font-size: 10px;width: 21px;line-height: 12px;padding: 2px 0;text-align: center;border: 1px solid #006621;border-radius: 4px;box-sizing: border-box;display: inline-block;position: absolute;left: 0;} .ad-link a {color: #006621;text-decoration: none;font-size: 14px;line-height: 14px;} .ad-copy {color: #000000;font-size: 14px;line-height: 18px;letter-spacing: -0.34px;margin-top: 6px;display: inline-block;} .ad .breaker {font-size: 0px;} #ad-4 {font-family: Arial, sans-serif;background-color: #FFFFFF;} #ad-4 .ad-title{color: #2130AB;} #animation-wrapper .cta-lex{color: #FFFFFF; width: 80%;} #animation-wrapper .lex-logo{display: inline-block;} @media (max-width: 500px) {.ad {padding: 20px 18px;max-width: 630px;}} Applying for a Mortgage? Call 844-346-3296 Repairing Your Credit With Lexington Law Can Help You Save Thousands Get Started Now Privacy Policy Call now for a FREE consultation CALL 833-337-8339 CALL 833-337-8339 jQuery(function () { function loop() { var chatMessages = [ { name: “ms1”, msg: “Did you find out about the negative item on your credit report?”, delay: 500, align: “right”, showTime: false,

[ad_1] Quick answer: You can try joining a credit union, signing up for a starter credit card, getting a credit card through your current bank, applying for a secured credit card, becoming an authorized user on another person’s account or taking out a credit builder loan. Make sure to check your credit score and credit report for a complete picture of your current credit. The best way to build credit over time is to make your payments on time over the years. Payment history accounts for the biggest impact to your credit score. But if you’re wondering how to start building credit when you don’t have any payments to make, check out some of the best practices below. The best way to build credit over time is to make your payments on time over the years. Payment history accounts for the biggest impact to your credit score. But if you’re wondering how to start building credit when you don’t have any payments to make, check out some of the best practices below. 1. Join a Credit Union (Best) You can often open a checking or savings account—or both—at a local credit union without any credit history. After a year or less of building a good rapport with that financial institution, demonstrating that you can handle your accounts responsibly, and saving a little money in your accounts, you can apply for a credit card or small loan with the credit union.  Credit unions are more likely to take a risk on account holders in good standing, even if you don’t have a lot of credit history. By managing these small loans or credit cards responsibly, you can build credit for the future.   2. Starter Credit Cards Credit cards are a common credit entry point for people. When you’re considering credit cards, look for a card you’re likely to get approved for that offers the best perks you can get. It’s tempting to go for cards that offer lots of cash back or travel rewards. While those rewards might be nice, these types of cards often come with a hefty annual fee. If you’re just starting to build credit, you may want to avoid that.  3. Get a Credit Card from Your Bank Just as a credit union might be more likely to take a risk on you, your bank might be willing to approve you for a credit card. This is especially true if you’ve been a responsible checking or savings account holder for some time. Do pay attention to interest rates, though. A high-interest-rate card from your bank is not better than a lower-interest-rate card with someone else. When possible, look for a card that offers an introductory 0% APR for a year. This can help you practice using credit without incurring a lot of interest expense in the process. 4. Secured Credit Card While we did say to avoid annual fees on credit cards when building your credit, there are some exceptions to this rule. You may find that you have no other options, and in this case, a secured credit card can help you start your credit profile. These cards require a deposit up front that secures your initial credit limit. This amount is typically as low as $250 to $300. As you build credit with such a card, you can usually apply for a better card and eventually get your deposit back. I Can’t Get Approved for a Credit Card If you find that you’re denied for any credit card you apply for, even secured cards, pull your credit reports. You may be surprised that the problem isn’t a lack of credit but a serious negative mark on your credit report.  Knowing what’s on your credit report that’s driving your score down or causing credit denials is important. You can proactively work to fix those issues or dispute the item if it’s not accurate. Get Your Free Credit Score & Monitoring Plus Weekly Updates From Our 50+ Experts Get It Now Privacy Policy 5. Become an Authorized User If you have trouble getting a credit card of your own, consider becoming an authorized user on someone else’s account. If someone you trust who manages their account responsibly will add you as an authorized user, you can “piggyback” off their timely payments. Make sure that the credit card company in question does report account information to the bureaus for authorized users; otherwise, there’s no point to this option. 6. Credit Builder Loan You don’t need a credit card to build new credit. Credit builder loans are similar to secured credit cards. You deposit enough to secure the loan balance. The deposit you make is held in a locked savings account until you pay off the loan. Then, you get the balance back. This isn’t a way to get a loan for something you need right now, as you have to have the cash to get the loan. However, it can be a way to demonstrate responsible account management and build credit history. 7. Credit Building App Credit-building apps such as ExtraCredit help you understand your credit history and score. They can even provide recommendations for credit cards, loans and other products that might be a good match for you so you can apply and build your credit. Get ExtraCredit What Credit Score Do I Start With? No one has a credit score of zero. The credit score ranges from 300 to 850.  Why Don’t I Have a Credit Score? It’s possible not to have a credit score at all, though. The credit scoring models require a certain amount of information to score your credit history. If you don’t have credit history, have only had one account for a short period of time or haven’t had an open credit account in a while, you may not have a credit score. To avoid having no credit score as a young adult, you may want to start considering ways to build a credit history. Things You Shouldn’t Do to Build Credit