Seven Advantages to Building Credit Before Graduating

Credit and how to manage it is an important subject that is often neglected in high schools and even colleges, unless it’s a part of your degree field. However, it is something that everyone should at least have some knowledge about. Whether you are purchasing a car or renting/buying a house, your credit score is used for a long list of large purchases along with smaller, everyday items as well. We have put together a short list of things to keep in mind, along with tips, to make sure you understand the world of credit.

What is a Credit Score?

A credit score tells banks and lenders how likely you are to pay your loan back in a timely manner. It is based on your credit history which is a record of how much you have borrowed and paid back. Late payments decrease your score, while consistent, on-time payments will gradually increase your score.

What makes a Credit Score Good or Bad?

Credit scores are typically rated on a scale from 300-850, with a higher score meaning better credit. According to Experian, a credit reporting agency, 700 or above is considered good, while above 800 is excellent. The average credit scores fall in the 600-750 range. However, don’t be discouraged if your score is low, as there are many ways to raise it. These include making payments on time, cutting back on credit card spending, paying off debt, along with more ways that can be found with a quick internet search.

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Keep these seven things in mind as you consider credit cards and building your credit:

1. Getting a credit card can teach good credit habits.

Buying a car, a house, or any other large item is something that will more than likely require a loan from a bank. Many get the amount they apply for but the interest rates on these loans vary, and they can make a world of difference. Having a higher credit score is the biggest thing lenders use to determine the interest rates on these loans. Banks will see that you have a high score, meaning you are someone who doesn’t miss payments often and can be trusted to pay off the loan they are giving you. It can add up to a lot of saved money! Be careful, however, borrowing too much money or late payments will knock your credit score down.

2. Cardholder perks

Every credit card comes with its own set of perks. Even cards from the same company have different rewards. Some cards provide airline miles, while others provide cash back. These are just two of the rewards credit cards can give you but there are a lot more out there. Student cards may come with a lower credit limit but can give the cardholder access to things like scholarships, 0% APR for the first year, and discounts on school supplies.

3. Receive lower rates on loans

Buying a car, a house, or any other large item is something that will more than likely require a loan from a bank. Many get the amount they apply for but the interest rates on these loans vary, and they can make a world of difference. Having a higher credit score is the biggest thing lenders use to determine the interest rates on these loans. Banks will see that you have a high score, meaning you are someone who doesn’t miss payments often and can be trusted to pay off the loan they are giving you. It can add up to a lot of saved money! Be careful, however, borrowing too much money or late payments will knock your credit score down. 

4. Makes for a more appealing tenant

When attempting to rent a home, you will most likely have to submit your social security number so the landlord can see your credit score. You are much more likely to get approved or possibly chosen over other applicants if you have a higher credit score. This ties back to the loan section. The landlord will see that you have a high score and be more trusting of you to pay your rent on time and in full.

5. An increased credit limit on cards

The higher your credit score, the more willing a credit card company will be to give you a higher spending limit on your credit card. This can be nice for attempting to build your score higher or maybe covering you in an emergency situation you hadn’t saved up for. Maybe it’s an unforeseen health issue or car problems on a long road trip, a credit card can bring a sense of comfort knowing you have access to these funds in case a situation similar to these arises.

6. Save money on security deposits

Often, companies will charge a service fee when establishing utilities such as water, electric, or gas in your name for the first time or when moving to a new location. Having a good credit score can sometimes wipe these fees away completely!

7. Sense of achievement!

Having a good credit score is something to be proud of! Especially at a younger age. It is difficult to keep up on all of your payments, and adding another to the mix can be stressful and complicate things. If you are able to build your credit, that’s a big accomplishment. It shows that you have created a responsible spending plan and you have developed good credit habits. These are tools you will carry with you for life and will continue to be helpful as you progress into buying a home or whatever your next step may be.

Learn more and manage your credit score at AnnualCreditReport.com.

7 Reasons You Should Live, Learn, and Work in Missouri

1. Companies are hiring

Three companies on Forbes 100 Best Places to Work list – Veterans United, Jones Financial (Edward Jones), and World Wide Technology – are headquartered here in Missouri. Each company employs large numbers of people and reported hundreds of job openings company wide as of March of 2021. Jones Financial reported 910 job openings, Veterans United Home Loans reported 558 openings, and World Wide Technology reported 268 job openings.

According to an October 2021 report from the Missouri Economic Research and Information Center (MERIC), there were around 67,700 job postings in Missouri with companies hoping to hire people. If you’re looking for a new job or career change, Missouri is a good place to start. 

two people talking in a hip office space.

2. Great for remote work

A woman working on her laptop in the kitchen of her house.

Missouri is centrally located in the country, making working with both the east and west coasts convenient for remote workers or just those who need to be centrally located for travel. Additionally, high speed internet and better broadband access in rural areas has been made a priority by Gov. Mike Parson. In 2021, $400 million was budgeted to help with broadband access.  

3. Affordability

Missouri allows you to live in one of the most affordable states in the U.S. Missouri ranks the 12th lowest in the U.S. for cost of living (MERIC) and the 12th cheapest state to buy a house (learn.roofstock.com). To do a little comparison, let’s look at the cost of buying a gallon of regular unleaded gasoline. According to AAA, in Missouri, as of December 2021, the average cost of a gallon of gas is $2.95 while the cost in Illinois, Missouri’s neighbor, is $3.44. 

4. Fun and romance

A riverfront view of the city of Washington Missouri

Missouri is the 10th best place to be single. We rank 12th for dating opportunities, 12th for dating economics, and 16th for romance and fun, according to wallethub.com. 

If you live and work in Missouri, there are plenty of opportunities for romance as well as places to take your romantic partner on a date. Check out 8 Places to go on a Date Night in Missouri or just go to Visit MO’s Things to Do page

5. A Land of Opportunity

Missouri ranks No.4 in the nation in opportunity for its citizens, according to USnews.com. Missouri is a great place to start or own a business, boasting a rank of 11 in the country. Missouri’s businesses weathered the pandemic better than most and the state was ranked third in the nation for pandemic proof small businesses. 

If you’re interested in taking advantage of Missouri’s business-friendly atmosphere, the Missouri Secretary of State’s Office has step-by-step instructions for starting a business in Missouri.

6. Striving for Equity

Missouri ranks No.9 in the nation for equality. According to USnews.com, “the ratio of men to women in the labor force, as well as gaps between their median incomes, as well as the difference in unemployment between people with disabilities and those without, and gaps in educational achievement, income and employment between non-Hispanic whites and other racial groups” are measured to determine this. Missouri ranked 6th in the nation for equity in the income gap by race on this same list.

7. Family Friendly

Missouri is a great place to raise a family. Wallet Hub says Missouri comes in third in the nation for low cost child care, surpassed only by Mississippi and South Dakota. All 10 of Niche.com’s top 10 places to raise a family in Missouri are suburbs of St. Louis, with highly rated school systems, bright job prospects, and lower costs of living. However, St. Louis isn’t the only great place to raise a family and if you prefer the country or small-town life, there’s plenty of that too. 

This information is accurate as of December 16, 2021.

What makes Missouri a Great Place for new Grads

An overhead view of the town of Hermann. The bridge is illuminated over the Missouri River

If you have just graduated college or are about to graduate college, you have probably spent a lot of time thinking about your next move.

Maybe you want to stay and work in your college town. Maybe you want to go back and work where you grew up. Maybe you’re looking for something new – a change of scenery, a clean slate.

Whether you’re looking for a big city, a smaller town, or anything in between, the state of Missouri has a lot to offer new grads.

Midwest Momentum 

For many college grads, the cost of living in America’s coastal cities is too high. Even a high paying entry-level position will only land you a small apartment with multiple roommates in places like San Francisco, Boston, and Washington D.C. However, that’s not the case in the Midwest.

Every year, Porch, a paid service for current and aspiring homeowners, ranks the best cities for recent college graduates to live. The ranking factors in affordability, job market, and recreational activities available in a given city.   

In 2021, according to Porch, seven of the ten best cities for new college grads are in the Midwest. All ten cities are in landlocked states.

St. Louis

The state of Missouri fared well in Porch’s rankings. St. Louis scored the second-highest score among large metros to move to after college. This high ranking can be mostly attributed to St Louis’ low cost of living, which is about 10 percent less than the average large-size U.S. metro. And with large employers such as Ascension Health Alliance, Enterprise Rent-A-Car, and Emerson Electric, the unemployment rate for recent graduates in St. Louis is 1.8 percent.

The riverfront of St. Louis showing the Gateway Arch and other buildings at night. There is a slight reflection on the water.

Kansas City

The plaza fountain in Kansas City

The city on the west side of the state also ranks high among large metros for recent grads. Porch lists Kansas City at No.8.

Recent grads, especially those from Missouri’s colleges and universities, have been flocking to Kansas City for years – more so than St. Louis even.

With a championship NFL team in the Chiefs, an elite concert venue in the T-Mobile Center, awesome shopping at the Plaza, and a great late-night scene at Westport– on top of a strong job market and relatively low cost of living — Kansas City is a preferred destination for young people just starting their careers.   

Smaller Cities

If you’re looking for something a little smaller, less crowded, more cost effective, Missouri has some great small and midsize cities. Porch ranked Jefferson City the No.1 small metro for recent college graduates because of its low cost of living and strong job market. There are large companies headquartered in the state’s smaller cities, such as Bass Pro Shop and O’Reilly Auto Parts which are both headquartered in Springfield. St. Joseph’s cost of living is lower than the Missouri average, yet you’d still be only a one-hour drive away from Kansas City. Exploring Missouri’s small and mid-sized city options can offer the recent college graduate plenty of opportunity to choose from.   

Missouri State Capitol in the Spring. There are tulips in front of it.

Why making connections is essential for college freshmen

College is a very different experience than high school.

High school offers students structure. College offers students freedom. Take advantage of that freedom and you’ll graduate college with connections and friendships that will last a lifetime.

Step out of your comfort zone.

The best way to make connections at college is to get involved on campus, whether that be through Greek life, student run organizations, or talking to your instructors after class and during their office hours.

When you first get to college in August, start out by getting to know the people on your floor and in your residence hall.

Don’t be overwhelmed thinking you won’t have time for outside activities and responsibilities. You’ll only be in class for about 15 hours a week, which leaves plenty of time for working, studying, joining clubs, and hanging out with friends.   

Most colleges have different introduction events when students first move to campus, such as ice cream socials, mixers, concerts, sporting events, and activity fairs. Attend these events with an open mind. Stepping out of your comfort zone is not always easy, but over time, you will find it is almost always worth it.  

Build relationships with professors.

Many professors have office hours, in which students are encouraged to come in for one-on-one meetings. Making connections early on with your professors will prove beneficial when it comes time for midterm and finals, as well as when you start apply for internships, jobs, and/or graduate school and need letters of recommendation. Professors sometimes have hundreds of students in varying classes, so make sure they know your name and how much effort you’re putting into their class.

Remember, professors are there to help. Don’t hesitate to ask.