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If you are a fresh graduate just stepping into adulthood, it is quite natural for you to yearn to be financially independent. If you are looking at having a source of income during your post-graduation years, you are on the right track indeed. This is also the time when you need to think about getting the basics right as far as your finances are concerned and begin building a credit score. Building your credit from scratch on your post-graduation years is a good idea because it gives you the opportunity to build a solid foundation for your credit history. Here's how to go about with it. Get a
If you are planning to take up higher studies in an institution
on domestic shores or abroad, consider getting a student loan
instead of making a dent in your parents' savings. A good CIBIL
score that your parents may have maintained will help you obtain a
student loan, since you do not have any credit history to show for.
Once you have availed of the loan, be frugal with your spending and
try and save up as much money as you can during your years as an
academic so that you can pay off your student loan with ease at a
You may even consider taking up a part time job along with your
studies to augment your savings. Once you have completed your
education and join a job, try and pay off your student loan as soon
as you can. This will not only make you debt free, it will also
give you a great start to your CIBIL score. Paying off a student
loan ahead of time is akin to making a century in your debut
innings and it will put you in good stead with a good CIBIL score
when you need to avail of credit later in life.
Get your own credit card
If you are already working part time during your post-graduate
years, which is a more or less a necessity these days, consider
getting a credit card of your own, instead of using an add on card
of a working parent. A credit card when used judiciously is an
excellent means to build credit from scratch. However, make sure
that you know your limitations and keep your credit limit
accordingly so that you do not overspend. Also do not jump for the
first credit card that promises to give you an "attractive offer".
Use the services of a web aggregator to check out the various
features and benefits that various credit cards offer and compare
them on parameters such as rate of interest, annual fee and reward
points. By making a fair comparison you will be able to arrive at a
card that is best suited to your personal needs.
Inculcate good financial habits
Good financial habits should begin from the time you are able to
comprehend money matters and decide that you are old enough to take
care of your own money. For instance, if you are using a credit
card, make sure you are making timely repayments of your full
outstanding amount each billing cycle. Furthermore, get into the
habit of beginning to save in small amounts. For instance you can
begin an SIP with an amount as small as Rs 500 each month and
gradually keep increasing this amount as you begin to increase your
You must have heard the saying the "early bird catches the
worm", and it cannot be more true to your financial health. So
start concentrating on building good credit right from your post
graduate years and start saving for a later date. Good financial
habits from the very beginning will keep you away from falling prey
to a financial crisis even if you were to find yourself in an
untoward financial situation later. Ample savings and a good CIBIL
score will surely see you through!
We, at CreditVidya, believe in empowering you. Because we believe that knowledge is not only power but also gives you a sense of belonging. We believe in supporting the consumers by not being their crutch but as catalysts and enablers.
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