Do personal finance writers ever change their minds about the right things to do? For sure. Several years back, I reversed course on young adults having credit cards before they started working.

I now think it’s necessary to have one as soon as the latter high school years, or upon starting university or college. Having a credit card with a modest spending limit helps build financial skills and opens the door to money-saving opportunities from buying online.

There’s one more reason, and it’s the most important. Using a credit card responsibly is the best way to establish a good credit score.

A reader asked a while back for some input on how long it might take a young adult to build a good enough credit score to rent an apartment or borrow from a bank. For answers, I checked in with Julie Kuzmic, Equifax Canada’s senior compliance officer, consumer advocacy. Ms. Kuzmic said that in a case where someone has a single credit card that is paid in full each month, Equifax has seen people build and improve a score within six months.

“Keep in mind that this time frame could be impacted by various factors including credit card balances that are very close to the credit limits, applying for more credit accounts or making a late payment,” she added in an e-mailed response to questions.

Equifax, a big player in packaging credit score data, says on its website that lenders typically regard people with a credit score of 660 and up as good to excellent borrowers. Ms. Kuzmic noted that landlords and lenders may have their own view about what a “good enough” credit score is. They may also consider factors such as job status and income in deciding whether to rent an apartment or offer a loan with a competitive interest rate to someone.

A lot of banks offer no-fee credit cards to students who are 18 or 19 and up, depending on the province. Once a student reaches that age and is earning some income via part-time or summer work, it’s time to start considering a credit card so there’s plenty of time to build a good credit score.

Two rules for credit card rookies: Pay for all purchases immediately online, so there’s never a scramble to pay a monthly bill, and keep the credit limit at $500 or $1,000 to limit the damage caused by misuse.

I used to think that young adults didn’t need credit cards until they started working, and that it was predatory for banks to offer cards to young people. But building a credit score is too important to delay. Lenders, landlords, employers and insurance companies look at credit scores today in assessing people. Start early to make a good impression.

The Globe and Mail, December 13, 2022