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There are many ways that you can build and establish credit. Your credit score is made up of a number of factors, two of which are how much you currently owe and your overall payment history. As such, applying for and responsibly using a credit card can help build your credit, as can paying off your credit card statement on time and in full.

When deciding how much to use your credit card to build credit, it’s a bit of a balancing act. If you simply have a credit card but don’t use it, it may not improve your credit score very much. But if you spend too much on your credit card, you may damage your score. Building your credit comes down to finding the sweet spot between not using your card at all and using it too much.

Recommended: Tips for Using a Credit Card Responsibly

How Making Purchases With Your Credit Card Could Possibly Help Your Credit Score

The amount of credit that you use and your overall payment history are two of the most important factors that determine your credit score. As you start to establish credit, you’ll want to responsibly use your credit card, making sure to keep your spending low in comparison to your overall credit limit. You’ll also want to make at least the minimum payment by the statement due date or, even better, pay off your statement balance in full each month.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score?

Minor Purchases to Build Credit

As you work toward building your credit, you’ll likely want to put some of your everyday purchases on your credit card. Just make sure that you set aside enough money to pay off your statement balance when it comes.

Recommended: What is the Average Credit Card Limit?

Groceries

Groceries are one of the biggest monthly expenses for many families and households, so it can make sense to put your grocery purchases on your credit card. Most grocery stores accept credit card payments for no additional charge. Then you can plan to pay off your statement balance by the due date to help build your credit.

Gas

Gas is another large expense for many people. Most gas stations accept credit cards with no additional charges. Plus, paying for gas with a credit card is also usually more convenient. Keep in mind that some gas stations may offer a discount for paying for gas with cash, which can be a good way to save money on gas.

Utilities

Admittedly, utilities can be challenging to pay with a credit card. Some utilities may offer online payments with a credit card without a fee, though others may only allow fee-free payments by cash, check, or ACH. Unless you can find a way to dodge fees, it doesn’t make financial sense to pay a convenience fee just to pay bills with your credit card.

Coffee

If a daily coffee run is part of your regular routine, consider paying for it with your credit card. That way, you can earn credit card rewards and possibly build your credit, too, from a purchase you’d be making anyways. Also check if your coffee shop offers its own rewards program — you’ll want to make sure to sign up for that as well to take advantage of perks and offers.

Streaming Subscriptions

If you have recurring monthly subscriptions to places like Netflix, Hulu, or Disney+, that can be another cost to move over to your credit card. Setting up those recurring streaming subscriptions for autopay can help ensure your service is not interrupted and possibly build up your credit history.

Gym Membership

A gym membership is another potential cost to pay with a credit card in order to build up your credit. You’ll want to make sure that you are getting value from your gym membership, however. If you find that you rarely go to the gym, you might get better value from canceling your membership and saving or investing that money.

Entertainment

If going out to eat or other forms of entertainment are frequent monthly expenses for you, consider covering those with a credit card. Having a variety of expenses on your credit card statement can help you stay organized and more easily track your spending — plus, you could build your credit in the process.

Major Purchases to Build Credit

Besides everyday smaller purchases, it can make sense to use a credit card for major purchases as well. Many credit cards offer price protection or an extended warranty, which can provide additional benefits.

Car

Whether or not you’ll be able to use a credit card to pay for a car purchase will depend on the policies of the place where you’re buying the car. Some dealerships will allow you to cover the full cost of the car with a credit card, while others only allow credit cards for partial payment, such as the down payment.

Just make sure to negotiate a final price before you offer to pay with a card — otherwise, the dealer may try to charge a higher price to make up for credit card processing fees.

Recommended: What is a Charge Card?

Jewelry

Jewelry is another big-ticket item that you might cover with a credit card. Talk with the store where you’re making your purchase to see what options are available. Some jewelry stores might offer a discount for paying with cash, which might sway you in the choice between cash or credit card.

Home Appliances

There are several reasons it can make sense to buy large home appliances with a credit card. Not only could you earn rewards and build your credit, but the credit card you use may also offer credit card protection. This can potentially save you hundreds of dollars or more if you end up having a problem with your appliance down the road.

Taxes

It is possible to pay your taxes with a credit card, though there are very few ways to do it for free. Depending on where you live and the type of taxes you’re trying to pay, you’ll likely pay a convenience fee of 2% to 3%. Still, depending on what kind of rewards your card earns and your overall financial situation, it can make sense to pay taxes with a credit card.

The Takeaway

Just having a credit card may help build credit some, since your total amount of available credit plays a factor in determining your credit score. But if you’re really looking to build credit, you’ll want to use your credit card, and use it responsibly. Put some of your regular purchases and big-ticket items on your credit card, and make sure to have a plan to pay your statement off in full, each and every month.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

What is a credit score?

Your credit score is a number that lenders can use to help determine how likely you are to repay your debts and obligations. The higher the credit score, the better, with the maximum credit score being 850.

What items help you build credit?

There are a variety of factors that make up your credit score, including the age and type of credit accounts you have, how much of your available credit you’re using, and your payment history. Responsibly using your credit card and paying off your balance in full and on time, for example, can help to build credit.

Recommended: When Are Credit Card Payments Due?

What is the fastest way to build up your credit?

There generally are not any magic bullets to build up your credit from scratch fast. That said, one of the best ways to build up your credit is to show a history of reliably paying your bills on-time, each and every month. The longer your track record of using your existing credit responsibly, the better it is for your credit score.

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Photo credit: iStock/Tingting Ji

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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In many cases, a secured credit card can be a good way to establish and build credit. However, if you’re planning to get a secured credit card to build credit, what’s critical to determine is whether the issuer reports usage to the major credit bureaus.

Many issuers do, but some may not. If your issuer does not report information to the credit bureaus, then a secured credit card won’t help build your credit. But if the issuer does, then that secured credit card could be a good starting point for your credit-building journey.

What Is a Secured Credit Card and How Does It Work?

There are two different kinds of credit cards: secured credit cards and unsecured credit cards. An unsecured credit card is what most people think of when they think of a traditional credit card. In many ways, a secured credit card operates in much the same way, with the bank extending a specific amount of credit that you can use throughout the month and that you won’t have to pay until your statement closes at the end of the month.

However, there is one major difference between a secured credit card and an unsecured credit card. With a secured credit card, you have to put down a security deposit. The amount of this deposit is usually what then serves as your credit limit.

This money that you put down also acts as collateral. If you fail to pay the amount borrowed, the lender can take that deposit to help cover its losses. This added protection for the lender is why a secured credit card is generally easier to qualify for if you have a thin credit history.

If you use your credit card responsibly, you’ll get your deposit back in full when you close your account or get upgraded to an unsecured credit card.

Recommended: What a Credit Card Is

Can You Build Credit with a Secured Credit Card?

It is possible to build credit with a secured credit card — as long as your issuer reports usage and payment activity to the major credit bureaus.

If that information is reported, then you could build credit with a secured credit card, assuming you use your account responsibly. For instance, if you routinely make on-time payments, that could make a positive impact on your score, since payment history is one of the key factors that determines your credit score.

Recommended: Tips for Using a Credit Card Responsibly

Tips for Building Credit with a Secured Credit Card

Here are a few tips for establishing credit by using a secured credit card:

Make Sure Your Issuer Reports to the Credit Bureaus

If the issuer of your secured credit card does not report to the major credit bureaus, it is not likely to have an impact on your credit history or score. When looking at and applying for a secured credit card, make sure that it will report usage and payment history to the credit bureaus.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score?

Pay Your Statement Balance On Time and In Full

Your overall payment history is an important factor in determining your credit score. Make sure to pay your secured credit card bill on time, each and every month. You should also not spend more money on your card than you have, so that you can pay your statement balance off in full when it comes due.

Avoid Maxing Out Your Card

Another factor that makes up your credit score is your credit utilization ratio, which is defined as your total balance divided by your total available credit limit. It’s generally recommended to keep this ratio at 30% or lower, if possible. In order to avoid negative effects to your credit score, you’ll want to steer clear of maxing out your card, even if that money is technically available to you.

Recommended: What is the Average Credit Card Limit?

Other Ways You Can Use Credit Cards to Build Credit

Besides using a secured credit card, here are a few other tips for building credit with a credit card:

•   Increase your credit limit when possible. Again, this can lower your credit utilization rate, which is a major factor in determining your score.

•   Set up automatic payments. This way, you never make a late payment. Payment history has the biggest impact on your credit score.

•   Use your credit card regularly. While it might seem safest to keep your credit card tucked away unused, it’s necessary to use it to demonstrate to lenders that you can responsibly repay your debts. Just make sure not to spend more than you can afford to pay off in full.

•   Limit new credit applications. While it might feel tempting to try to get better cards as your credit starts to get established, keep new credit applications to a minimum. Each application results in a hard inquiry, which temporarily lowers your score. Too many applications within a short window of time can also raise a red flag for lenders.

•   Monitor your credit report. Even if everything seems like it’s smooth sailing with your credit, it’s smart to check in regularly. Review your credit report for any errors or any potential signs of fraud.

The Takeaway

If you’re not sure whether you’ll get approved for an unsecured credit card, you might consider a secured credit card instead. With a secured credit card, you put down a refundable security deposit upfront, which serves as your total available credit. Because of this deposit, lenders may be more likely to approve you. If you are approved, using a secured credit card can help you build credit — as long as your issuer reports usage to the major credit bureaus and you use your card responsibly.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

How much will a secured credit card help my credit score?

There isn’t a specific formula to determine how much a secured credit card can help your credit score. Instead, you should focus on making and strengthening good financial habits like living within your means and paying off your credit card in full, each and every month. A secured credit card can be one way to help your credit score in this manner.

What is the best secured credit card to build credit?

The best secured credit card will vary depending on your specific financial situation. You’ll want to look for a secured card that reports to the major credit bureaus, charges low or no fees, and has a low interest rate. There are secured credit cards that offer a limited rewards program as well, which can make for a nice perk in addition to building your credit.

Can you get a secured credit card with a bad credit score?

Yes, it is possible to get a secured credit card with a bad credit score. Because you are putting down the initial security deposit, lenders may consider you as less of a risk than someone applying for an unsecured credit card. Therefore, you may have greater odds of approval when applying for a secured credit card.

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Photo credit: iStock/Delmaine Donson

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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Taking out a home mortgage can be one of the biggest financial decisions you make. While some people can, it’s uncommon to pay for a house entirely with cash. Most people put some money as a down payment and then take out a mortgage for the rest of their home’s purchase price. But before you sign on the dotted line, you’ll want to make sure you understand how a mortgage affects your credit score.

The good news is that, as long as you regularly make your mortgage payment on time, having a mortgage can help your credit score. You may see a slight negative impact to your credit when you first apply for a mortgage, since the lender will likely pull your credit report. But after that, your mortgage will generally have a positive impact on your credit score, assuming you’re consistently making on-time payments.

Recommended: When Are Credit Card Payments Due?

Does Having a Mortgage Help Credit Score?

One of the mortgage basics is that in exchange for an upfront payment (generally used to purchase a home), you’ll make regular monthly payments to your lender for a specified period of time (often 30 years). Having a mortgage on your credit report can help your credit score in two ways. First of all, making your mortgage payments on time each month helps show a positive payment history. Another way that having a mortgage can help your credit is by diversifying your credit mix, which is another factor that makes up your credit score.

How Mortgage Application Impacts Credit Score

The process of applying for a mortgage can impact your credit score in a variety of different ways. Here’s a closer look.

Situations Where It May Hurt Your Credit

When you apply for a mortgage, your lender will usually do a hard pull on your credit report to assess your overall creditworthiness. The number of recent inquiries on your credit report is a negative contributing factor to your credit score, so you’ll want to limit the number you make within a certain window of time. One way to do this is to wait to apply for a mortgage until you are sure you have a sufficient credit score needed to buy a house.

Recommended: What is the Average Credit Card Limit?

Situations Where It May Help Your Credit

It can be smart when applying for a mortgage to work with different lenders to find the right lender for your situation. One piece of good news is that multiple mortgage-related inquiries in a short period of time usually will only count as one inquiry. So if you’re working on establishing credit, you won’t need to worry about multiple inquiries from different mortgage lenders pulling your credit report, as long as they’re all within the same window of time.

How a Mortgage Can Affect Your Credit

Beyond applying, there are a number of ways that having a mortgage can affect your credit. When you get a mortgage it can help your credit score, but it can also hurt it.

Hard Inquiry When You Apply

One of the factors that makes up your credit score is the number of recent hard inquiries you have. Any time a potential lender conducts a hard pull of your credit report, it can cause a temporary drop in your credit score by a few points. This drop usually goes away after a few months, but it’s something to be aware of.

Paying Your Mortgage On Time

One of the biggest factors that affects your credit score is your payment history. So if you have a mortgage and regularly pay it each month, that can make a positive contribution to your credit score. This is one reason it’s important to make sure that you don’t take out a mortgage that you’ll have trouble paying each month.

Late Or Missed Mortgage Payments

Because your payment history is such a big part of what makes up your credit score, late or missed mortgage payments can have a large negative impact on your score. Potential lenders look at your credit report to get an idea of how likely you are to repay your debt obligations, so having late or missed payments can be a red flag to future lenders.

Improving Your Credit Mix

A lesser-known but still important part of what makes up for your credit score is your overall credit mix. Generally, it’s considered a positive sign if you have a variety of different types of loans on your credit report. This includes credit cards, auto loans, mortgages, personal loans, etc. Adding a mortgage to a credit report that doesn’t have one helps diversify your credit mix.

Changing Your Average Age of Accounts

Another factor that makes up your credit score is your overall average age of accounts. Potential lenders like to see a lengthy history of you responsibly using the credit that’s been issued to you. So while initially a new mortgage will lower your overall average age of accounts, over time it will work in your favor.

Recommended: Tips to Qualify for a Mortgage

Tips for Building Your Credit Score After Buying a House

After you’ve bought your house, here are a few tips to continue building your credit:

•   Pay your mortgage in full and on time, each and every month.

•   Continue to pay your other debts (like credit cards and student loans) on time each month as well.

•   Keep an emergency fund to ensure you can still meet your debt obligations (including your mortgage) even when the unexpected happens.

•   Make sure you save enough money to pay your home insurance and property taxes (if your mortgage isn’t escrowed).

•   Regularly review your credit report for unexpected or inaccurate information.

•   Increase your credit utilization ratio by raising credit limits and limiting debt.

•   Limit your new credit inquiries as much as possible.

Recommended: Tips for Using a Credit Card Responsibly

The Takeaway

Having a mortgage can affect your credit score in a variety of ways, but most of them are positive. While you will likely see a small temporary drop in your credit score due to the hard pull from your mortgage lender, that should go away after a few months. Then, as long as you regularly pay your mortgage on time each month, you should hopefully see a positive impact on your credit score from having a mortgage.

Another great way to build your credit can be by responsibly using a credit card. Many credit cards, like the SoFi Credit Card, also offer cashback rewards for everyday usage. If you’re approved for the SoFi Credit Card, you can earn unlimited cash-back rewards. You can use those rewards as a statement credit, invest them in fractional shares, or put them toward other financial goals you might have, like paying down eligible SoFi debt.

The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.¹

Take advantage of this offer by applying for a SoFi credit card today.

FAQ

How long does it take for your credit score to go up after buying a house?

When you get a mortgage (or any type of loan), the potential lender will likely do a hard pull of your credit report. Because the number of recent inquiries you have is a factor that makes up your credit score, this hard pull may temporarily drop your credit score. The good news is that it usually only drops by a couple of points, and even that small effect usually goes away after a couple of months.

How long should I wait after closing to make another big purchase?

You want to be careful about making large purchases or applying for any other credit before you are approved for a loan. This is because your lender and underwriter will be digging into your credit report in detail to make sure your overall financial situation is sound, and they’ll want to know about anything out of the ordinary. After you close on your mortgage, you don’t need to be as careful about making another big purchase, as long as it fits into your overall financial picture.

What credit score is needed to get a mortgage?

There isn’t a specific credit score that’s needed to get a mortgage. Instead, each lender will have its own criteria for approving mortgages. Your overall credit score, your total down payment, and the house itself will all play a role in whether you’re approved, and at what interest rate.

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Photo credit: iStock/sturti

¹Members earn 2 rewards points for every dollar spent on purchases. No rewards points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points into your SoFi Checking or Savings account, SoFi Money® account, SoFi Active Invest account, SoFi Credit Card account, or SoFi Personal, Private Student, or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per every point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

¹See Rewards Details at SoFi.com/card/rewards.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Members earn 2 rewards points for every dollar spent on purchases. No rewards points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points into your SoFi Checking or Savings account, SoFi Money® account, SoFi Active Invest account, SoFi Credit Card account, or SoFi Personal, Private Student, or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per every point. For more details, please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, Member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information.

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If you’re wondering, “do monthly subscriptions build credit?,” the answer is that it depends. You’re most likely going to build credit if your payment activity is reported to the three major credit bureaus — Experian, Equifax, and TransUnion — or if you use certain payment methods like a credit card.

If you’re hoping to build credit with subscriptions, however, there are certain steps that you can take to help ensure that happens.

What Are Monthly Digital Service Subscriptions?

Monthly digital service subscriptions are a cost that you pay each month to access a service, such as online streaming for TV shows, movies, and music. It can also include subscriptions to software, including for photo editing, audiobooks, online classes, and ebooks.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score?

How Monthly Subscription Services Can Help Build Your Credit

Subscription services can help you build your credit if your payment activity is reported to the credit bureaus. You can ensure this happens by using your credit card to pay your bills or signing up for a service that reports your payment activity to the credit bureaus.

When your payment activity is reported to the credit bureaus, your monthly payments for subscription services will appear on your credit report. This can lead to either a positive or negative effect on your credit. If you miss a payment, your score could be negatively impacted, whereas on-time payments could have a positive effect.

As such, here’s a trick for ensuring that on-time payment consistently happens: setting up automatic payments.

Strategically Using Automatic Payments

Setting up automated bill payments is how you’ll most likely pay for subscription services. To make strides toward building credit, however, there are some ways you can set up your automatic payments more effectively:

•   Automatically pay with your credit card: When signing up for a subscription service, you’ll be asked for a method of payment. The simplest option is to pay using your credit card, and authorize recurring charges. Of course, you can do so using your debit card (depending on the company) or by providing your banking details. But unless you sign up for a credit reporting service, your payment history most likely won’t be reported to the credit bureaus without selecting your credit card as the payment method

•   Automatically pay your credit card from your bank account: To ensure you’re paying your credit card bill on time, consider setting up automatic payments from your bank account. That way, you’ll decrease the likelihood of missing a payment deadline. If the charge is paid on time, you’ll also get the benefit of avoiding interest charges, which is one way to save on streaming services.

If you follow these tips, it’s smart to periodically check the subscription rates to ensure your automatic payment amount matches up with what you’re currently being charged. Also check your bank account to make sure you have enough funds for the payment to go through on time.

Recommended: What is a Charge Card?

Other Ways to Build Credit

There are other methods to establish credit other than through subscription services. Here are some additional or alternative methods to consider:

•   Secured credit cards: A secured credit card is generally more accessible to those who have no or limited credit history. You’ll need to make a refundable deposit that acts as your credit line — so if you put $500 down, you’d get a $500 credit line. Otherwise, you can use a secured credit card as you would a traditional credit card by making purchases and paying down the balance each month. Depending on the credit card issuer, you may be able to be eligible to upgrade to an unsecured credit card or request one after making consistent on-time payments for a set number of months.

•   Credit builder loans: These types of loans are designed to help consumers build credit. Once you’re approved for a loan, you’ll start to pay it back in installments. But instead of receiving the loan proceeds right away, the funds will be housed in a savings account until you pay back the loan in full.

•   Personal loans: If you need funding right away, such as for a home improvement project, you can consider taking out a more traditional loan, as there are lenders who are willing to work with those who have a limited credit history. Keep in mind that interest rates could be higher compared to someone with more established credit, so make sure you can afford the loan and make on-time payments before taking one out.

•   Secured loans: Like secured credit cards, secured loans require you to put down some sort of collateral. These can include physical assets, such as a car (like auto loans) or cash (some banks offer loans that you secure with your savings account). Interest rates may be more favorable than unsecured loans.

•   Paying rent: Your landlord — especially if it’s a larger property management company — may report your payment activity to the credit bureaus, even if you don’t use your credit card to pay. Otherwise, there are reporting services (much like the ones mentioned above) that will report your payments to the credit bureaus to help you build your credit.

Recommended: Tips for Building Credit

The Takeaway

Your monthly subscription services could serve as a path toward building credit, as long as your payment activity gets reported to the credit bureaus. You can ensure this happens by either paying your subscription with a credit card or signing up for a service that reports your payments to the credit bureaus. In either case, you’ll need to make sure you’re handling your subscription service payments responsibly in order to help establish your credit.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Is it good to put subscriptions on your credit card?

You can put charges for subscriptions on your credit card if you’re looking to build credit. Just make sure you’re exhibiting positive credit behavior by consistently making on-time payments.

What credit card is best for subscriptions?

There is no one credit card that is best for subscriptions. Whether it’s a secured or unsecured credit card, what matters is whether you make consistent, on-time payments. The credit card you choose will also depend on what you find important. For example, if you’re interested in earning travel rewards, then consider picking a credit that allows you to do so.

Does paying multiple times a month increase your credit score?

Making multiple monthly payments toward your credit card bill will reduce the amount of credit you’re using. In other words, you’ll lower your credit utilization — a comparison between your total credit limit and how much credit you’re using — which could be a positive contributing factor in your credit.

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Photo credit: iStock/simpson33

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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Marriage doesn’t directly affect your credit scores since you and your spouse will each still maintain separate credit histories. However, both of your credit histories can affect any shared accounts and future possibilities of taking out a loan together.

Or, if you live in a community property state and take out loans after getting married, both of you could be responsible for that debt. Let’s take a look at what happens to your credit when you get married.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score?

What if Your Spouse Has a Bad Credit Score?

First off, your credit won’t directly be impacted once you get married, since your marital status doesn’t show up on your credit reports.

If either of you had loans before you got hitched, then they’ll simply remain on your respective credit reports. Same goes for any individual loans you take out after you’re married. One notable exception is if you were to apply for loans together, like a mortgage. In this case, the rates and terms you may qualify for could be less competitive because your spouse doesn’t have a good credit score.

Or, it could be that if you were to open a credit card with both your names on it (or an account where one person is the primary cardholder and the other is an authorized user on a credit card), both of your financial behaviors will affect your future credit score. Say your spouse has a history of late payments, which would have a major impact on their credit score. If they were to miss a payment on your joint account, then both your credit scores could be affected, since your name is also on the account.

If possible, it’s best to discuss the pros and cons of joint accounts and other financial matters with your spouse. This includes coming up with a plan to help them build their score before you apply for joint loans.

Tips for Building Your Credit Score With Aid from Your Spouse

If either you or your spouse wants to build credit, here are some best practices for doing so:

•   Review your credit report: Checking your credit history reports from all three major credit bureaus (Experian, Equifax, and TransUnion) can give you some insight into what is affecting your score. That way, you can use those insights to change your financial behavior. Plus, if there are any errors that may affect your score, checking your credit report will help you spot and dispute them.

•   Continue to make on-time payments: Paying your credit card bills on time is a major factor that affects your score. Doing so consistently signals to lenders you’re being responsible with credit.

•   Hold off on opening new accounts: Each time you apply for a loan, a hard inquiry will occur, which could temporarily affect your score. Too many hard inquiries within a short period of time could signal to lenders that you’re stretched thin financially and need to rely on credit. As such, be mindful about when and how often you’re applying for new accounts.

•   Request a credit limit increase on your credit cards: Credit utilization is another major factor affecting credit scores. It looks at the overall credit limit of your revolving accounts (like credit cards) compared to your overall balance. If you can increase your credit limit, it could lower your credit utilization, which is favorable for your credit score. Another option is to apply for a new credit card, like the SoFi cash-back rewards credit card, though only if you’re certain your credit can afford the slight dip from a hard inquiry.

Will Changing Your Name Affect Your Credit?

Changing your name to your spouse’s after you’re married won’t affect your credit. However, it will result in an update to your credit report. The major credit bureaus should update your credit report automatically once lenders start reporting your credit activity using your new name. When this happens, your old name will remain on your credit history but as an alias.

To ensure your new name gets reported on your credit report, you’ll need to notify your lenders. It’s also a good idea to update your name with the Social Security Administration and any other relevant official entities.

Recommended: What is the Average Credit Card Limit?

How Cosigning a Credit Card With a Spouse Can Impact Your Score

Becoming a cosigner means you’re legally agreeing to be responsible for the other party’s debt. In other words, acting as a cosigner can affect your score positively or negatively, depending on your spouse’s financial behavior.

For example, if your spouse consistently makes on-time payments and keeps their credit utilization low, then your credit score could be positively affected. However, if they make late payments or worse, the account gets sent to collections, your score and theirs could take a hit. Still, you might decide it’s worth the risk if you’re hoping to help your spouse establish credit.

Recommended: When Are Credit Card Payments Due?

Do You Share Debt When You Get Married?

Any debt that you or your spouse had before you got married will remain each of your own responsibilities. Once you’re married, however, any joint debts are shared. Whether debt that’s only taken out in one person’s name is considered shared debt will depend on what state you reside in.

If you live in any of the following community property states, both you and your spouse will be responsible for all debts acquired during the time you’re married — even if they’re not joint ones:

•   Arizona

•   California

•   Idaho

•   Louisiana

•   Nevada

•   New Mexico

•   Texas

•   Washington

•   Wisconsin

•   Alaska (residents can opt into community property laws)

If you’re unsure of what you and your spouses’ responsibilities are, or if you have any concerns related to marriage and credit scores, it’s best to seek the advice of a legal expert.

Recommended: Tips for Using a Credit Card Responsibly

Should You Join Your Credit Accounts After Getting Married?

Merging your credit accounts is a decision that only you and your spouse can make, and it will require a discussion about your expectations and basic credit card rules. One of the main benefits of merging your accounts is the ability to simplify your finances. Doing so could make it easier to keep records and compile documentation for tax returns.

However, if you will both be responsible for debt, both of your credit scores could be affected if either one misses a payment, for example. You can consider keeping one credit account in each of your names in case of an emergency though, even if you do decide to merge your accounts. And whether you’re choosing a joint bank account or a joint credit card account, make sure to shop around and compare your options.

Recommended: Comparing Joint and Separate Bank Accounts in Marriage

Discussing Credit With Your Spouse Before Marriage

Communication is key in your relationship, even before you’re married. It’s crucial that you have a detailed conversation with your partner about both of your financial situations. This includes any debt incurred, as well as any behavior that could negatively affect your finances. After all, it’s ‘til death do us part (and here’s a look at what happens to credit card debt when you die).

To help prepare for your financial future together, consider discussing plans you have that may involve the need to rely on your credit, such as buying a house. That way, if either of you doesn’t have an ideal credit score, you can come up with a plan to work on it together.

The Takeaway

One of the keys to a successful marriage is understanding how each other’s financial situation — including credit behavior — can affect the other person. Whether you open an individual or joint credit account, it keeps both of you in the loop so you’re working as a team.

If you’re looking for a new credit card to level up your financial situation, consider the SoFi credit card. With the SoFi credit card, you can earn cash-back rewards, apply them toward your balance, redeem points for stock in a SoFi Active Invest account, and more.

The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.¹

Take advantage of this offer by applying for a SoFi credit card today.

FAQ

Do lenders look at both spouses’ credit scores?

Lenders will look at both spouses’ credit scores if they’re applying for a loan jointly. Otherwise, if you only want one name on the account, the lender will only look at that person’s credit.

Can credit be denied based on marital status?

Credit issuers and lenders are not allowed to deny credit based on your marital status. This is due to protections offered by the Equal Credit Opportunity Act against discrimination when applying for credit.

What happens if I marry someone with low credit?

You won’t be directly affected, as your individual credit report is still yours. However, it could impact your score if you apply for credit jointly and your spouse doesn’t handle the shared account responsibly. It could also impact you in terms of what joint loans you may be able to qualify for, as well as what terms you receive.

Does my spouse’s debt merge with mine?

Any debt that you and your spouse have before marriage will remain separate. You’ll share debts if you have joint loans. In some community property states, both spouses are considered responsible for all debts acquired during the marriage, even if only one name is on them.

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Photo credit: iStock/LightFieldStudios

¹Members earn 2 rewards points for every dollar spent on purchases. No rewards points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points into your SoFi Checking or Savings account, SoFi Money® account, SoFi Active Invest account, SoFi Credit Card account, or SoFi Personal, Private Student, or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per every point. For more details please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

¹See Rewards Details at SoFi.com/card/rewards.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Members earn 2 rewards points for every dollar spent on purchases. No rewards points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points into your SoFi Checking or Savings account, SoFi Money® account, SoFi Active Invest account, SoFi Credit Card account, or SoFi Personal, Private Student, or Student Loan Refinance, your rewards points will redeem at a rate of 1 cent per every point. For more details, please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, Member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

This article is not intended to be legal advice. Please consult an attorney for advice.

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