Millennials, here's how to improve your credit in 3 easy steps

Millennials tend to get a bad rap. Judging from the op-eds and headlines, it'd be easy to think that millennials are the most entitled, irresponsible generation to ever live. These types of criticism conveniently overlook the terrible condition of the economy when millennials started to enter the workforce, as well as the growing costs of higher education.

But whatever the causes, the fact remains that many millennials are struggling financially - and this includes their credit scores. Your credit score is incredibly important, helping to determine whether or not you can qualify for a mortgage, what kind of interest rates you'll be charged on your loans and much more. The good news is that if you're a millennial and your credit score isn't where you want it to be, there are steps you can take.

Here are three ways to build up your credit score.

"Only 37% of millennials own at least one credit card."

1. Get a credit card
More than any other generation, millennials are resistant to credit cards. A survey from Bankrate and Princeton Survey Research Associates International found that among people in the millennials' age range - i.e. aged 18 to 29 years old - only 37 percent owned one or more credit cards, while the rest had none. People aged 30 to 49 were more than twice as likely as millennials to carry two credit cards, and consumers aged 50 to 64 were three-times as likely.

This is important because, as you might imagine, credit card history plays a major role in determining credit scores. The length of the consumer's credit history comprises 15 percent of traditional FICO credit scores, while the payment history itself accounts for 35 percent. For millennials, the longer you wait to apply for and start using a credit card, the harder it will be to build up a great credit score.

2. Don't fear credit
On a related note: Millennials, you shouldn't fear credit and debt. At least, not as much as you probably do.

It's the fear of credit and debt that discourages so many millennials from embracing credit cards and other forms of borrowing, as a study from Facebook IQ revealed. That report found that millennials see paying off debt and credit as the primary mark of financial success. That's a good instinct up to a point, but it becomes detrimental when it's all you care about. Again, you need to use credit to build up your credit score. That means taking out an auto loan is actually good for your score, assuming you pay it off regularly and in full.

Nothing to fear here.Nothing to fear here.

3. Sign up for nontraditional credit
There's a potential paradox in those last two recommendations. If you, like many other millennials, don't have a lengthy credit history, your low credit score may be an obstacle to qualifying for an auto loan, or even a credit card with a decent interest rate. This can seem like an endless, unbreakable cycle - you can't qualify for more credit, and so you can't develop a positive credit history.

If that's the case, you should consider signing up for nontraditional credit, such as PRBC. Nontraditional credit incorporates not just your traditional credit history, but also the payments you make for rent, utilities, cable bills and more. By finding a lender who accepts nontraditional credit, you can use your PRBC score to qualify for loans and accounts that wouldn't be able to access with your FICO score alone. You can then take on loans and lines of credit, pay them off and see your traditional credit score improve.

There's no reason to wait when it comes to your credit score, the time to start building and enhancing your credit is now.

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