Building Credit from Absolute Zero

Jul 1 2026

Written by Ashley Donohoe, a Certified Financial Literacy Professional℠ (CFLP®) with 15 years of financial writing experience.

When I finished high school, figuring out how to build credit was a learning process. As a young adult, getting approved usually isn’t easy since creditors need some evidence you’re responsible enough, but you need someone to first give you a chance to make that happen. At the same time, building credit early is important since not doing so can come back to haunt you when you’re applying for a job or apartment, buying insurance, financing a car, and so on.

You’ll likely need to start building your credit in ways other than applying for a regular credit card or loan. The good news is that there are several options that give you a chance to build your credit without having previous credit history. Let’s look at a step-by-step blueprint that you can use for building credit from absolute zero.

Become an Authorized User

Some people prefer to start building credit without worrying about getting approved for their own account right away. If you know somebody who has a high credit score and handles their accounts well, you could ask if they’re comfortable with making you an authorized user. A parent is usually the best option but not always the only option to add you as an authorized user to an existing credit account.

The way it works is that the account owner will have their credit card company add you to their account and send you your own card. You don’t actually have to use that card for this step to help you build your credit. But if you do use the card, make sure you make your payments on time. Plus, you won’t be responsible for any charges the main account holder generates.

Your credit score should get better as the main account holder makes payments on time, keeps the balance reasonable, and does other responsible things with the card. You benefit from their good credit behavior.

There is some risk, though. If that person doesn’t prove to be responsible, their bad actions can also hurt your credit score. This is why it's so important to trust the primary credit account owner.

Find the Right Secured Card

A secured credit card is an account that requires a refundable cash deposit to be placed as collateral at setup. This deposit amount usually matches your card credit limit. It is specifically designed to help people with no credit or bad credit to build good credit.

This is a bit more involved but I’ve found it to be less risky and highly effective for someone building credit from absolute zero. (Note: You can use both options at the same time to help build good credit faster.)

Secured credit involves applying for a secured credit card through your bank, one of the big card companies, or somewhere else. The creditor will still pull your credit, but not having any credit history usually is not a dealbreaker.

If approved, the secured card works like a "normal" credit card. You just have to manage to your limit and, absolutely make sure you make your payments in full and on time. Many creditors have plans that allow you to upgrade to a regular card once you've displayed good credit management over time. When applying for a secured card, watch out for high interest rates and potential annual fees.

Consider Credit Building Loans

A credit card is a solid start. Showing you can handle different accounts can build your credit even faster. While credit mix is only 10% of your FICO score, every bit helps when you’re starting from zero. That’s where a credit building installment loan comes in. You’ll mostly find these through credit unions or online banks/lenders.

The way a credit-builder loan works is that you place a loan amount, like $500 or $1000, into a secured savings account of Certificate of Deposit. You then make fixed, on-time payments for a set term, typically 6 to 24 months. The lender reports your payment activity to the major credit bureaus, so making on-time payments builds your positive payment history. And when the loan term is complete, the funds are released and you get access to the principal amount and often any interest earned.

If you feel that a credit-builder loan is a good idea for you, always make sure to make on-time payments or the loan can actually work against your intended goal of building good credit behavior.

Have Your Rent Payments Reported

Considering how expensive rent payments are, it’s frustrating to learn that they usually don’t automatically count for building your credit. That’s a big difference from mortgage payments that do show up on your credit report. There are some ways around this, though, if you sign up for a rent reporting service.

I prefer Experian Boost and Self because they don’t charge you anything to report your rent payments. You just need to sign up, connect the bank account you use for rent, and pay on time as usual. Some services also let you add utility payments and certain other payments to report. From there, the service sends your payment updates to one or more of the three bureaus.

In some cases, your landlord might already use a rent reporting service, so it’s worth checking before you sign up on your own. In any case, find out how long it takes for the first payment to be reported and whether there’s any way to have past rent payments counted.

Avoid Predatory Student Loans

For many young people, student loans seem like the best option to pay for college when other resources have come up short. The fact you can get federal ones without a credit check makes them easy credit to get when you’re starting out. And even private student loans can work out if a parent or someone else cosigns. However, student loans in general can be predatory.

It’s easy to rack up large balances for your degree and underestimate how much those payments will be once you graduate. The interest charges can easily grow your balance even if you make income-based payments. Then you have to consider how it’s hard to get out of the loans, since even bankruptcy usually doesn’t save you here.

Its often recommend to borrow the least amount possible to protect your credit and avoid headaches down the road.

You can also pursue other ways to lower the costs of higher eduction. Having earned several degrees, I’ve secured financial assistance from Grants, a small business discount program, exams for credit, and nontraditional courses. You can also complete general-ed courses cheaply at a community college or online, instead of at a college or university. Doing so gets core classes completed at much less expensive costs per credit.

Manage All Accounts Smartly

While you’re building credit having a good strategy is critical to successfully building a high credit score. Small mistakes can put you in a worse place than you started. Here’s what I suggest:

Never miss a payment. I consider this the biggest one since your payment history is the biggest contributor to your credit score. Use automatic payments rather than relying on yourself to remember alongside all your other responsibilities. Calendar alerts are also never a bad idea so you can double-check the payment went through and have a general idea of when everything is due.

Keep card balances low. You have less control over this one as an authorized user. But if you have a secured card or other credit card in your name, don’t let the balance climb above 30% of your limit, and I’d say 10% is even better. I personally avoid balances altogether for most cards since I hate paying interest, so keep the cost in mind too.
Keep applications minimal. When you apply for credit, the lender uses automated tools to check your credit history. Doing this too often can drop your score and, thus, impact future credit applications. You also don’t want to overdo it and struggle to juggle several accounts and payments. I recommend starting with one or two things, like the secured card and credit building loan.
Be careful about closing. Aim to keep your accounts open so they continue to build your credit. Closing one out can actually throw you back a bit since now your average credit age would be shorter. Time is your friend here.

Monitor Your Credit Regularly

Expect to wait a while before you see all of this work pay off in your credit score. Experian says generating a FICO score alone can take around six months, while it can be upwards of a year to achieve what’s considered good credit.

Sign up for one of the free monitoring services, like those the three bureaus or Credit Karma offer. The credit score you see isn’t exactly perfect compared to what lenders see, but it will still give you an idea of how things are heading. You’ll also see your credit reports on those sites, or you can also get them through AnnualCreditReport.com.

Check both your report and score at least every month. Besides checking how much your score is going up, look over your report for any accounts that seem unfamiliar or information that looks incorrect. Doing this can also help you spot identity theft and report it before too much damage is done to your credit and overall finances.

Like many things in life, good credit is earned, not given. I hope these tips help you get started to build your own good credit history and scores.

Frequently Asked Questions

Do people start with a credit score of zero?

The lowest a FICO score can get is 300, so someone without a credit history wouldn’t have a score of zero. Instead, they wouldn’t have a score at all since there’s no credit history to calculate that. Opening an account that’s reported should start to build the score.

How can I help my child build credit?

If they’re younger than 18, the best way is to make them an authorized user on a long-established account. Check about any age requirements first, though. Also, don’t feel like you need to hand the card to your child.

Can I get a regular credit card if I’m starting with no credit history?

It’s possible but harder than going the secured card route. Looking for a student credit card or another basic card for beginners will probably give you better results than trying to apply for a fancy rewards card.

What types of things can help me get a good credit score?

Making on-time payments to a mix of accounts with low balances is a great place to start. Keeping those accounts open for a long time and not applying for new ones you don’t urgently need will also help. Plus, have your utility and rent payments reported if you can.