10 Proven Ways to Help Your Child Build Credit Before College

By Kat Tretina | Published on October 21, 2025

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Your child’s credit history plays a significant role in their life, especially as they prepare for college. Their credit can help them secure competitive rates on student loans¹, qualify for off-campus apartments, and maybe even get a job. In fact, the National Association of Professional Background Screeners found that 31% of employers conduct credit checks on at least some job candidates, and 13% of companies credit-check all their candidates.

Of course, a low credit score isn’t the only potential hurdle. According to TransUnion, more than 45 million Americans are credit invisible, meaning that they have so little credit history that they don’t have a credit score. If your child falls into this category, it can be incredibly difficult to qualify for low-rate student loans, credit cards, or even get a cell phone in their own name.

But this doesn’t have to be a long-term problem. Here are some things you can do now to help your child build credit at a young age.

1. Add your child as an authorized user to your credit card account

If you have a solid credit history and a good credit score yourself, you may be able to let your child piggy-back off your good standing by adding them as an authorized user to one of your credit card accounts. Most credit card issuers report payment activity to the three main credit bureaus: Transunion, Equifax, and Experian. They do this for every account user. So, once you add your child’s name to your account, your credit card history and record of on-time payments will show up on your child’s credit report as well as on yours.

As an authorized user, your child will be able to use your card to make purchases. Unlike you, however, they won’t be liable for payments. Fortunately, there are ways to impose healthy boundaries on your child’s spending behavior.

As the primary account holder, you will be able to view all transactions your child makes. You can also set spending limits. These ensure that your child won’t overextend your credit utilization ratio, i.e., the proportion of debt to available credit you have, and a key factor in your credit score.

Keep in mind that this kind of credit piggy-backing benefit is generally only available for credit cards. Because most debit cards are linked to personal checking accounts, they don’t allow secondary users. Plus, since banks don’t report debit card activity to credit bureaus, your child won’t get the same benefits with a debit card user as they would with an authorized credit card.

2. Get credit for the bills they already pay

A number of services, like Experian Boost, can help young adults get a credit boost for the things they already pay for. These can include:

• Rent payments
• Utility bills
• Streaming service subscriptions
• Cell phone bills

What’s more, you won’t just get benefits for making on-time payments going forward – once you sign up for a credit-boosting service and add your bank account info, the platform will gather data on past payments. It will then apply any credit increase instantaneously.

3. Open a secured credit card

Without established credit history, your child is unlikely to qualify for the most dependable tool for building credit: credit cards. That’s why secured credit cards exist.

With a secured card, your child first puts down a security deposit — usually somewhere between $200 and $5,000. This deposit acts as their credit limit. Once they spend that amount, they can’t make any more purchases until they make a payment.

A secured credit card helps students establish a payment history and begin building good habits. Some secured cards even allow users to earn cash back rewards on purchases.

4. Borrow a credit-builder loan

A credit-builder loan is a type of loan specifically designed to help individuals with bad credit or no credit improve their credit score. It’s also a great option for young people who are working to establish credit history for the first time. Unlike conventional loans, where the borrower receives the loan amount upfront and then pays it back over time, a credit-builder loan works in reverse. Here’s a simplified breakdown of the process:

1. Sign the loan agreement: When your child takes out a credit-builder loan, the lender agrees to loan them a certain amount of money. However, instead of disbursing the funds to them at the beginning, the lender holds the promised money in a secured savings account or a certificate of deposit (CD) account.
2. Make regular deposits: Your child will then make regular, scheduled payments towards the loan over a set term, which can range from six months to a few years. These payments include both the principal amount and interest.
3. Reap the credit-reporting benefits: When your child starts making payments, the lender reports that payment activity to the major credit bureaus. Consistent, on-time payments can positively affect their credit score.
4. Access the funds: Once your student has finished making all the scheduled payments, the lender will then release the funds to them. At this point, they’ll receive the total amount that was held in the account, minus any fees or excess interest charges.

By demonstrating that they can make regular payments, your child is likely to improve their credit score, which can make it easier to qualify for other types of credit — such as credit cards, auto loans, or mortgages — going forward.

5. Cosign a credit card

If you can’t add your child as an authorized user on your line of credit, you may be able to get them their own credit card by cosigning. When you cosign a credit card, you’re agreeing to take joint responsibility for the debt incurred on that card. That gives credit card companies an extra layer of security, which may make them more willing to approve borrowers with little credit history. Here’s how cosigning a credit card works:

1. Designate a primary cardholder: The primary cardholder is the person who applies for the credit card and will be the main user. In this case, the primary cardholder is your child. Once you find a credit card you’re interested in, you’ll fill out an application under their name.
2. Understand the cosigner’s responsibility: As a cosigner, you are just as responsible for the debt on the credit card as your child is. If they fail to make payments, it becomes your obligation to repay the remaining balance. This responsibility is legally binding and can impact your credit history.
3. Establish a line of communication: Cosigning any line of credit is a serious financial decision. If you have any doubts or concerns about your child’s spending or your ability to manage it, it may be wise to explore alternative ways to help them build credit. If you do trust your child, it’s crucial that you both sit down together and agree to communicate openly and honestly about the card’s usage and payments. Regularly reviewing statements together and discussing any concerns can help maintain trust and prevent any surprises.

6. Cosign a car loan

If owning a car makes sense for your child and your family’s finances — and your child is the minimum age to be loan-eligible — consider cosigning an auto loan for them instead of buying them a car outright.

Auto loans generally have lower rates than other types of loans — like personal loans — which makes them a potentially ideal place to start. Keep in mind that, as with any other cosigning agreement, the debt will appear on your credit report as well as the primary borrower’s. But as long as the primary borrower doesn’t make late payments, this shouldn’t hurt your credit score.

It’s also important to remember that cosigning a loan will affect your debt-to-income ratio. This is a calculation of your monthly income compared to your monthly debt payments. Lenders use this ratio to determine your eligibility for other loans, like mortgages.

If you have too much debt compared to your income, it may put you out of a lender’s approval range. So, before you cosign, make sure your DTI will be low enough to qualify for whatever loan you may be seeking in the near future.

7. Encourage your child to complete the FAFSA

Taking out a loan without a cosigner is another great way to establish credit history. If your child currently has little to no credit history, however, it can be hard to find a lender that will take them on. Fortunately, the federal government has a generous lending policy, especially for aspiring college students. Unlike private lenders, the government doesn’t conduct a credit check or require candidates to have a minimum credit score. When your child takes out a loan, the loan will show up on their credit report, establishing their credit history. And, as they begin making payments, their payment history will boost their credit, too.

If your child will need to borrow money to pay for college, encourage them to complete the Free Application for Federal Student Aid (FAFSA) as early as possible. This online form will make them eligible for federal financial aid, including federal student loans, grants, and work-study programs.

8. Cosign private student loans

Federal loans are a great way to start building credit, but not all students can cover their entire cost of college with federal aid alone. That’s because there are annual limits on how much undergraduate students can take out in federal student loans. Once your child reaches that cap, they’ll need to find other ways to pay for their remaining college expenses. That’s when where private student loans come in.

As with federal student loans, private student loan payments get reported to credit bureaus — which makes them a great way to build credit history. The only catch: Private student loan lenders check applicants’ credit, so college students are unlikely to qualify for a loan on their own. You can help your child get a loan and start continue building their credit history by cosigning their loan application.

As a cosigner, you share responsibility for the loan’s repayment. But having a cosigner allows your child to get the money they need for school and potentially get a lower interest rate on the loan.

9. Set payment reminders

According to the Fair Isaac Corporation, the organization behind the FICO credit score, your payment history accounts for about 35% of your credit scores. That makes on-time payments absolutely essential to building and maintaining good credit. Show your child how to set up payment reminders for all of their bills and credit accounts. This is an easy way to ensure they don’t miss a payment—and that their credit doesn’t suffer unnecessarily.

Also encourage them to enroll in automatic payments if their creditors offer that feature. Some lenders, including Earnest*, offer interest rate discounts when borrowers sign up for autopay². That helps your child save money and build credit at the same time.

10. Teach them to budget and track spending

To build good credit and maintain their credit score, your child needs to learn basic financial literacy — that is, solid budgeting and money management skills. Before your child leaves for school, make sure they know how to manage their spending and live within their means. This financial education refresher should also include:

• Budgeting basics: Teach your child how to track and manage their spending and create a budget that works for them.
• Limiting debt: Make sure to also teach them the importance of spending less than they earn. Talk about the pitfalls of excessive debt and how interest payments can build up over time.
• Responsible data use: Remind your student to carefully guard new credit card information, social security numbers, and other personal financial information. Fraud and identity theft can also impact your student’s credit.

Your child’s credit history and credit score have a big impact on their ability to afford college. Good credit is key to not only loan approval, but to securing low interest rates. Both can reduce the overall cost of your student’s loans and help protect them from excessive debt.