So, you're making the exciting move to a new country - the US! But navigating the banking system and building credit can be a bit challenging. Don't worry; I'm here to help!
By the end of this article, you'll know how and when to open a bank account in the US, how to build your credit score properly, and avoid common pitfalls that could cost you thousands down the road.
What you need to have to open a bank account:
First things first, to open a bank account in the US, if you're not a US resident, you'll need a form of identification, like a passport. You must also be at least 18 years old, or bring a guardian with you if you're not. Proof of residency might be required, but it varies from bank to bank. Lastly, Being physically present is a must for opening an account, so plan your visit accordingly.
How Does This Work?
Once you have your bank account set up, you'll have a checking account for transactions, a savings account is for your cash reserves, and a debit card for direct deductions from your checking. However, the real gem is a credit card! Having a good credit score is vital in the US, and a credit card helps you
build that score.
Here's a pro tip: Pay off your bills every 14th and 29th to avoid carrying debt
Understand Credit Card And Credit Score:
So, what does a good credit score give you? First and foremost, it makes loans cheaper. When you're ready to buy a house, a good credit score will save you big bucks on your mortgage. Not to mention, it opens doors for getting better deals on cars, cell phones, and other services.
And how are these credit scores calculated? Four main parameters come into play: utilization, payment history, credit history, and credit checks. To keep your credit score on the rise, aim for low utilization, pay bills on time, maintain a good credit history, and avoid unnecessary credit checks.
Here's how you can achieve these goals:
1. Keep your credit utilization under 30% and ideally under 5%. Set reminders to pay bills on the 13th and 25th of the month to avoid missed payments.
2. Consider taking a small loan and paying it back on time to build a payment history.
3. Don't close your oldest account; it's valuable for your credit history. Also, becoming an authorized user on someone else's old account can boost your history.
4. Increase your credit line after some time, but remember, opening new credit cards comes with credit checks.
5. Monitor your credit score with apps like Credit Karma, but keep in mind that the score may vary slightly from the actual one.
With these tips, you'll be well on your way to a strong credit score, enjoying lower interest rates and better financial options.
Remember, be responsible with your credit card use, and start as soon as you can.
And lastly, If your'e moving to Austin- reach out to get our favorite bank list, where we found the process runs easier than others