Unless you have enough cash to finance your entire life, you'll probably need credit at some point. Whether you'll need to take out a mortgage to buy a house, take out a car loan, or borrow money to start a business, a good credit score will help you get better rates.
But a good credit score doesn't always come easy. If you have bad credit, it often takes some time and effort to repair it. Meanwhile, having no credit at all is almost more of a hurdle. Why? Because lenders are especially fickle about loaning money to someone whose ability to repay is still unproven.
Still, everyone starts with the same clean slate when it comes to credit. And while using a credit card responsibly is a great way to build or improve your credit, it's far from the only method that works.
Here are five ways to build your credit history and improve your score without getting a credit card:
Option #1: Take out a small loan at your bank or credit union
If you have a healthy relationship with a local bank or credit union, check with them first to see if you meet the criteria for a small, personal loan. If you do, borrow as much as you need for a large purchase you planned to make anyway -- or a small amount you know you can repay over time.
Once you secure a small installment loan, you should make repayment a priority. This type of loan is likely the best way to help you build credit or improve your credit score, but only if you make your monthly payment on time, every time.
Option #2: Ask to be someone's authorized user
If you are close with someone with good or excellent credit, you can always ask