The dream for many people is to live without debts. The thought of being able to use your money as you will, no need to worry about credit cards, interest, late fees, etc. is quite appealling. But is it a good idea?

The trouble is that how good your credit is can determine quite a bit of how your life goes overall right now. It’s not just that without a credit history it’s hard to get good rates when you get a home loan or a car loan. It can have an impact in many areas of your life.

Your credit score can impact the rates you pay for insurance. Companies consider people with poor credit scores to be a greater risk.

It can even impact your job hunt. Some employers run a credit check, and just as with the insurance companies, consider you a poor risk as an employee if you have poor credit.

But building a credit history does not mean you need to get into debt. It just means you need to have and use a credit card at least a little bit. You don’t have to go to extremes, but use and pay off right away, just to show that you can do it.

Living completely without a credit history is unfortunately a bad idea for most people. But you can use it just enough to have the score you need to look good financially when you need to.

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