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Why does having a bank account affect your credit?
I’m 15 yrs old
I have a son🤷🏻♀️
I wanna be a tattoo artist
I have high goals for myself & refuse to be a statistic! #Teenmom
#money #gottastartsomewhere
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Tammy Laframboise
Present pension and financial planning information to members of a pension
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Tammy’s Answer
Having a bank account and good credit will help you attain your goals.
Sometimes it seems like it is easy to get credit with all the advertising that financial institutions do. However, my sister's experience was quite different. She was a waitress with a respectable income, mostly from tips. However this type of income didn't allow her to get a credit card. Without a credit card she could not rent a car or do many other things. She finally convinced her bank, because she had a bank account, to open a credit card account with the smallest amount allowed - $100. She devotedly spent $100 every month on her credit card and paid it off 100% every month. After about 6 months the credit limit was raised and over time she was able to establish a credit rating. The key to her good credit rating was paying off the balance every month. It demonstrated that she was a good credit risk.
Credit is a valuable tool that can easily be misused. Gaining access to credit is important in attaining other goals.
Good luck!
Introduce yourself to a person at your bank. They can then be a good source of information and a future reference.
Sometimes it seems like it is easy to get credit with all the advertising that financial institutions do. However, my sister's experience was quite different. She was a waitress with a respectable income, mostly from tips. However this type of income didn't allow her to get a credit card. Without a credit card she could not rent a car or do many other things. She finally convinced her bank, because she had a bank account, to open a credit card account with the smallest amount allowed - $100. She devotedly spent $100 every month on her credit card and paid it off 100% every month. After about 6 months the credit limit was raised and over time she was able to establish a credit rating. The key to her good credit rating was paying off the balance every month. It demonstrated that she was a good credit risk.
Credit is a valuable tool that can easily be misused. Gaining access to credit is important in attaining other goals.
Good luck!
Tammy recommends the following next steps:
Wayne Archibald
Cybersecurity Associate Director here to share knowledge!
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Wayne’s Answer
Hi Allanah,
It's great that you have high goals. That's a great start to being successful.
Your bank account information does not show up on your credit report, nor does it impact your credit score. However, lenders use information about your checking, savings and assets to determine whether you have the capacity to take on more debt.
When applying for loans and/or credit cards, lenders first look at your credit score and credit report to see your open and closed credit accounts and loans, as well as details about your payment history. From this, they can also tell how much available credit you have, how much you’re using, if you’ve had any debt go to collections and the number of soft or hard inquiries on your account within the past two years.
Source: https://www.cnbc.com/select/how-bank-accounts-impact-credit/#:~:text=Your%20bank%20account%20information%20doesn,to%20take%20on%20more%20debt.
Good luck!
It's great that you have high goals. That's a great start to being successful.
Your bank account information does not show up on your credit report, nor does it impact your credit score. However, lenders use information about your checking, savings and assets to determine whether you have the capacity to take on more debt.
When applying for loans and/or credit cards, lenders first look at your credit score and credit report to see your open and closed credit accounts and loans, as well as details about your payment history. From this, they can also tell how much available credit you have, how much you’re using, if you’ve had any debt go to collections and the number of soft or hard inquiries on your account within the past two years.
Source: https://www.cnbc.com/select/how-bank-accounts-impact-credit/#:~:text=Your%20bank%20account%20information%20doesn,to%20take%20on%20more%20debt.
Good luck!