Establishing your credit is like building a home. First you have to start with the foundation and build your way up. This is a long road that starts the first day of college and extends to the last days of your life. This highway needs a very prudent and disciplined driver, so that he or she is able to use credit as a tool to build a sustainable and growing net worth. Credit relates to financial literacy in many ways. First if you have good credit history; then you will have an access to money from financial institutions, and you will have the knowledge to know what investments are best with the money that you have in hand. People find out the importance of a good credit history at the point in the highway of life, when it is most needed. When you get to the crossroads. These crossroads could be either at a time when one needs financial support to pay for a wedding, to buy a house for your family, or buy a car to transport ones kids and go back and forth to work.

As you can see credit is very important. It can seriously aid a person in implementing the key ingredients in the recipe of life. However, as mentioned previously, you need to be careful that you do not lose this privilege. Explaining that credit is not privy to all people around the world can further emphasize this privilege. Other countries and more so emerging markets do not offer their pupils access to credit to purchase assets. As a result, we need to appreciate the benefits of an access to available credit.

Knowing the importance of good credit, I think a good credit can make a great impact in my life now and for the future. In short term it can help me obtain my first car, payments for college, or starting a checking account or savings account. Long term a good credit can help me get my first house, help me pay for wedding expenses, or even further down the timeline it can help me pay for my children s payments for their first car or aid in their college payments.

There are many steps to take that can make you credit savvy. Keeping a good credit consists of you keeping a proper balance between what you earn and what you spend, especially on credit. It is important that you avoid missteps that even responsible people can commit on occasion. Misplacing a bill, which will lead to missing a payment, for example, can show up as a negative on your credit report. This is why it is important to keep a budget for yourself and sticking to it. This will also help you see your cash flow. Then you can make changes in your budgeting to help you sustain enough money to pay your bills at the end of the month.

So often people do not realize why credit is so important and at what age your credit should start being established at. People too often do not keep track of their credit and assume a bad credit history. You should start establishing and maintaining a good credit once you get into your teens.

The moment you apply for a credit card and subsequently receive the card in the mail is basically the first financial decision in a long line of financial decisions to come. The first time you purchase an item on the card, is probably the first time that you enter information into your credit history report. But do any of us know the importance of paying the bills on time once it comes at the end of the month. We should responsively make your monthly payments. This will build you a great credit. The good credit history will allow you to use credit in the future. It is important thought that you are financial savvy to prevent abusing the credit privilege you obtain.

To continue your privilege in the line of credit, you have to know how to use it and not abuse it. To know how to use your credit is very important. This consists of the knowledge in where to make money investments and how much of an investment to make. It is important to diversify your investments and not put all your eggs in one basket as they say. Diversifying your investments will help you overcome poor investments and will allow you to sufficiently make more profitable investments.

Basically your credit is your passport for financial world. Take it wherever you go and use it any way you need, but make sure not to abuse your credit. For you will lose your passport into the financial world.

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