Having good credit means you can borrow money at good rates, and have fewer problems with your security clearance, job, apartment, and insurance. People with bad credit or no credit can have serious problems with those things – but you can always improve your credit rating. 


  • No credit history? Here’s how to build a good one. Pay bills that are included in a credit report, like car and credit card payments – and pay them when they’re due. Failure to pay on time can have a negative impact on your credit rating. Consider getting a secured credit card. These cards let you deposit money on the card up front, and then spend it down. Many credit unions, banks, and other companies offer secured credit cards and report how you pay for your card. Look for a card:
    • with no or low fees
    • that lets you earn interest on the money you deposit
    • that reports to the big credit reporting companies
    • from an institution where your deposit will earn interest.

    Then use your card a few times a month – you can buy things you’d buy anyway, like groceries or gas.

  • While you’re on active duty, federal law limits the interest rate to 6% on credit obligations you incurred before your military service or activation – including credit card debt. Interest above that is permanently forgiven and can’t become due once you leave active duty. 
  • Bad credit history? Here are some ways to improve it.
    • First, pay down your credit cards. Make a plan to pay the card with the highest rate first.
    • Don’t get any new credit cards. Having a lot of new credit hurts your credit score.
    • Keep your older credit card accounts open, even if you don’t use them.  Having credit for a long time helps your credit score.
    • After six months, check your credit report again using one of the free reports you’re entitled to every year from AnnualCreditReport.com.
    • Get help from your PFM or a certified credit counselor.
  • To keep your credit up while you’re deployed:
    • Meet with your PFM to plan your finances for your deployment.
    • Set up automatic bill pay programs, such as allotments.
    • Give someone you trust – your spouse or parent – access to your credit accounts.
    • If you’re deploying, set up an active duty alert to protect your accounts.
    • If you plan to use credit cards overseas, research before you go. Search “widely accepted credit card” and the name of the country to find out whether businesses there are likely to accept your card and whether there are any additional fees for using your card overseas.
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