Like you've experienced, it's difficult to establish credit these days if you don't already have some. Credit is one of those things that you need to have for some things (a very few) like a home mortgage etc. and a good credit rating will save you money when you do use your credit because you'll get more favorable rates if your credit rating is higher. The way the rating agencies work is they look at how much credit you have, how much you use (and don't use) and most importantly--what your payment habits are. The following scenario is designed to take you through a CONTROLLED PROCESS whereby you can establish or re-establish your credit. It is NOT recommended to be a lifestyle. In general you should minimize the number of credit cards you have, and use them for convenience or for emergency spending. It is NOT WISE to continually carry a balance on credit cards and pay the minimum or slightly above it every month. Having said all that. here is what I would do:
- Go to your bank or credit union where you have your checking and/or savings account. (if you don't have bank accounts you need to open at least a checking account. Also having a Savings account will be most helpful because it shows that you don't spend everything (or more) than you earn.
- ask your bank or credit union to issue you a credit card. If you don't already have one and have a relatively poor credit rating you may have to get a card with a very low credit limit, maybe $500-$750.
- When you get the card, use it to buy some essentials that you would normally buy anyway
(like groceries). Do NOT use the card up to the limit!