Girl holding a credit card

Building blocks of credit

Credit isn’t a bad thing if used responsibly and can be a tool that can help your future.


The word credit may be scary or viewed as something negative, but it can be the opposite. Credit isn’t a bad thing if used responsibly and is a tool that can positively help your future. Looking to get a mortgage? How about a loan for a new set of wheels? Building and having a good credit score is essential throughout your life and enables you to borrow money for these life events.

Importance of credit

Building credit is important as it identifies how you manage debt. By paying back the money you borrow with on-time payments, it shows you can responsibly manage debt and sets you up for the future.

A credit score will be given to you based on your credit behaviours. Credit scores range from 300 up to 900 points. When you’re first starting out, you’ll be at the lower end of the range. As you build your credit and display good credit behaviours, this score will increase. A score of 700 or above is considered good while a score of 800 or above is considered excellent. As good behaviours help improve your score, it’s important to note that bad credit behaviours can decrease this score. This score is with you forever, and it’s important you display positive credit behaviours.

You may think playing it safe by avoiding credit all together is the way to go, but in fact, it may be hindering you in the future. Without credit, you can’t show if you can manage debt responsibly which can impact your ability to get a loan, mortgage, etc.

Building credit

Start building credit as soon as possible. Start by applying for a low limit credit card after high school and paying the entire balance monthly. Credit cards are a great credit-building tool and can offer great additional features and benefits above and beyond just helping to build credit. Benefits from credit cards can range from insurance coverage to rewards points and even cash back to help pay your balance!

Good credit behaviours

Remember, good credit means you display positive credit behaviours showing you can responsibly manage debt. You can do this by:

  • Paying your monthly bills (utility, cell phone, etc.) on time each month. Consider setting up automatic payments.
  • Understand your spending and talk to a financial advisor to ensure the credit you have (credit cards, loans, etc.) is manageable and fits within your financial situation.
  • Pay your credit card balance in full each month. Remember your credit card statement ‘due date’ is the date the money is due on the account and payments typically take a few days to process. Make payments at least 2-3 days prior to your due date to account for processing times.
  • Do not apply for multiple loans or credit cards all within a short amount of time. Each time you apply for a loan, mortgage or credit card, the issuer does a hard credit inquiry or ‘a hit’ on your credit score showing that your credit has been checked. Excessive applications could affect your ability to be approved as it may look like you’re a riskier borrower or could be perceived as desperation.

Understanding your credit score and how your behaviours impact this score is important.  You can do a soft inquiry (an inquiry only visible to you and that doesn’t affect your credit score) by using www.transunion.ca. We also recommend speaking to your financial advisor. They’ll work with you to understand your credit and create a plan to help you reach your financial goals.

As you can see, credit doesn’t need to be a bad word. Building and developing good credit behaviours early on, help set you on the right track for life. Contact your financial advisor today to see how credit can be a positive for you.

What questions do you have about building your credit? Ask below and we’ll be sure to answer.

bill that says past due

Kick-start your finances: eliminating debt

Debt can have a negative impact on your day-to-day life. Here are a few things to know to become and stay debt-free.


It’s no secret that money can be stressful and is one of the top stressors on individuals, relationships and our ability to give back to our communities. Debt can be one of the reasons for that stress and play a huge roll in your health (physical, mental and emotional) and in the way you interact socially.

Debt can also prevent us from getting ahead financially. Whether one larger debt or a combination of several small ones, it can be difficult to make payments to eliminate that debt while still saving money for your goals. What is the key to eliminating debt and having financial freedom to save more money for your goals?

Don Hendrickson, Conexus Member Experience Coach, says there are three things to know to help you succeed in eliminating your debt:

  1. Being aware;
  2. Creating a budget; and
  3. Setting up automatic transfers.

“It’s key to understand how much you owe and the interest rates on each area of debt so that you can create a realistic plan on how you’ll eliminate this debt,” said Hendrickson. “As part of this plan, you need to create a budget that sets out a schedule on how you’ll spend your monthly income which should include your debt repayment amounts. If you’re struggling to find money in your budget for your debt repayment, look to see if any of your want expenses such as entertainment can be reduced.”

Once you’ve created a plan, set up automatic money transfers to have your debt payments come directly from your account each payday. This helps reduce the temptation on spending elsewhere and keeps you on track to reaching your set goals.

When it comes to multiple debts, Hendrickson says tackling your highest interest debt first will save you the most money in the long run but you may also want to consider paying off a smaller balance first to help motivate you.

“There’s some research that shows paying off a smaller balance first gives you the feeling of success and will help motivate you to continue,” said Hendrickson. “For example, if you have a $1,500 line of credit balance and $10,000 in credit card debt, tackling the $1,500 will give you the feeling of success and may also provide a great learning experience that you can then apply to tackle your other debt.”

When it comes to avoiding debt, Hendrickson said there are many things you can do including:

  • Living below your means and not spending more than you earn.
  • Don’t feel the need to ‘keep up’ with those around you. Only do what you feel comfortable with and that your budget allows.
  • Pay yourself first by making a habit to take 10% or more of your income and put towards your goals including an emergency fund. Having an emergency fund will ensure you’re prepared for whatever curve life throws you.
  • Sit down with a financial advisor at least once a year to review your short-, medium- and long-term goals and make a plan, or re-evaluate your existing plan, to ensure you’re on your way to successfully reaching those goals.

Debt can be stressful and coming up with a plan will not only reduce this stress but also help you towards financial freedom. Be sure to contact your financial advisor for assistance. Not only will they be able to help you come up with a plan to eliminate your debt, but also work with you to set a plan for your future. There’s no better time than now to take control of your finances – get started and make tomorrow, today.