Credit 101: What You Didn't Learn in College

With college graduation comes many new concerns: getting a "real" job, an apartment, maybe a car. You'll need to buy a good interview outfit, furnish that apartment and finance that car. And of course, it is summer, and you've worked hard for four years (maybe more) so you want a little fun in the sun, too.

If you're like many new college graduates, you probably don't have a lot of cash, so it may be tempting to use your credit card to finance these needs and wants. Before you give in to the lure of instant gratification, take a minute to contemplate your credit rating.

While it may sound pretty boring, your credit rating affects more aspects of your life than you might think. Need a loan for that car? The dealer will be checking your credit rating. And that apartment? The landlord will be taking a peek, too as he decides whether you'd make a good tenant. What about that dream job? Your prospective employer may want to see your credit report as well.

By taking control of your credit now, you're laying the groundwork for a healthy credit future.

Chances are you obtained at least one credit card, and maybe more, while you were in college. Statistics show that eight out of 10 college students have and use credit cards. While many college students use credit responsibly, for some, the urge to overspend gets the better of them.

No matter which group you fit into, the first step in taking control of your credit is checking your credit report. These reports, compiled by the top three credit reporting companies, track your credit usage and payment history. Everyone, even the most fastidious credit card user, should check their credit reports at least annually; there may be erroneous information on your credit report that needs to be corrected. You can request your credit report directly from the credit reporting agencie.

Errors can find their way into your credit report in many ways. Information from someone with the same name or a similar social security number may show up, or information can be incorrectly reported by your credit card company. If you do notice any discrepancies in your credit report, you want to get them corrected immediately.

If your credit report is in good shape, congratulations. Keep doing what you've been doing: paying your bills on time, keeping the number of credit cards you own to a minimum and using them wisely.

If you discover that your credit rating is not as good as you'd like, take steps to fix it. The only way to improve your credit rating is by establishing a good track record. So stop using those credit cards and start paying them off. If you have a number of credit cards, close at least some of them as you pay them off. Set up a budget that allows you to pay your bills on time. If you used student loans to help pay for your college tuition, make sure you factor those payments into your budget.

While you may have to put some purchases on hold, in the long run, you'll be glad you took control of your credit. The interest rate you receive on future credit cards can be impacted by your credit rating, as is the interest rate on your car loan. And when you go to buy a house a few years from now, you'll have laid a good credit foundation, which will be a major factor in getting approved for a mortgage. won't have to worry about being approved for a mortgage.

Take the first step toward controlling your credit by inspecting your credit report.