Building Credit

Megan McArdles has a number of good posts about credit unions, and how they help (or don't) build credit.

When I graduated from college, I had a well paying job, was living in New York, but had no credit history. I was a foreigner, and had used my parent's credit card in college, so although I had reasonable income, debt etc. I could not get a credit card of my own.

I ended up getting a secured card from Capital One, with ruinously high fees, and I had to send in a check for $200 (which was the limit on that card). Using the card for convenience, my credit score improved, and I switched to a regular Visa card a few months later.

I don't know what the details are with the teacher in Megan's examples, but I would like to add that there are lots of instruments out there that seem (and are) pretty awful deals, but once you start borrowing and paying back, you build credit very quickly and don't need to stay in those products long.