Why Does Credit Matter So Much in the U.S.?#
In the simplest terms, your credit score helps banks, landlords, and service providers decide how “trustworthy” you are when it comes to borrowing money or fulfilling financial obligations. A good credit score can open doors. It can mean lower deposits, higher loan approval rates, better car insurance rates, and even access to credit cards that give you cashback, travel rewards, or other perks.
On the flip side, having no credit history at all can be just as limiting as having bad credit. That’s why it’s smart to start building your credit early — and do it the right way.
What Makes Up Your Credit Score?#
Your credit score is calculated based on a few key factors:
- Payment history is the most important. Do you pay your bills on time? Even a single late payment can hurt your score.
- Credit usage (also called credit utilization) looks at how much of your available credit you’re using. Using too much of your limit — even if you’re paying it off — can be a red flag. Ideally, you want to keep usage below 30% of your limit.
- Length of credit history matters too. The longer your accounts have been open and active, the better.
- Types of credit you have — such as credit cards, loans, or car financing — can show that you know how to manage different types of borrowing.
- New credit activity, like applying for multiple credit cards in a short period of time, can temporarily lower your score. These are known as hard inquiries and are common when applying for credit cards, auto loans, or mortgages.
What Is a Credit Limit — and Why Does It Matter?#
When you get approved for a credit card, you’re given something called a credit limit. This is the maximum amount of money you’re allowed to borrow on your card at any given time. For example, if your credit limit is $500, that’s the most you can charge to your card before needing to pay some of it off.
Now, your credit limit plays a big role in your credit score, especially when it comes to something called your credit utilization ratio. That’s just a fancy term for how much of your available credit you’re actually using. For example, if you have a $500 credit limit and you spend $100, your utilization is 20%. Keeping this number low (ideally under 30%) shows lenders that you’re managing credit well — and that can boost your score over time.
Can You Increase Your Credit Limit?#
Yes! After showing a history of on-time payments and responsible usage, you may be eligible to request a credit limit increase from your card provider — sometimes even automatically.
Most credit card issuers let you apply for a higher limit through their app or website. Just look for a section called something like “Request Credit Line Increase.” They might ask you for updated income details or how much you’d like to raise your limit to. Some increases result in a soft inquiry (which doesn’t impact your score), but others may result in a hard inquiry — so it’s worth checking with the card issuer first.
Nervous About Credit Cards? Here’s How to Use Them Safely#
If you’re new to credit, the idea of borrowing money can be nerve-wracking — especially when you’re trying to be financially responsible. But here’s a helpful mindset shift: you can use a credit card like a debit card.
That means only spending money you already have. Every time you use your credit card, pretend that amount is instantly deducted from your bank account. At the end of the month, pay off your balance in full — not just the minimum payment. This avoids interest charges and helps you build a strong credit history at the same time.
Many credit cards (especially student cards) let you set up automatic payments, so you never miss a due date. That’s a great way to make sure your payment history stays perfect.
How to Track Your Credit Score (For Free!)#
Once you start building credit, it’s important to track your progress — just like you would with your grades or fitness goals. But where does your credit score actually come from?
First, Meet the Credit Bureaus#
There are three major credit bureaus in the U.S.: Equifax, Experian, and TransUnion. These are private companies that collect data from lenders (like your credit card company or student loan provider) and build your credit report based on how you manage your accounts.
Each bureau may have slightly different information because not every lender reports to all three. That’s why your credit score can vary a bit depending on which bureau is being used.
Every time you pay your credit card bill on time, open a new line of credit, or even miss a payment — it gets reported to these bureaus and reflected in your credit history. Over time, that history forms the basis of your credit score, which is usually calculated using models like FICO or VantageScore.
So How Do You Check Your Credit Score?#
You don’t need to pay to keep track of your score. There are several free tools that give you access to your score and credit report:
- Credit Karma and Credit Sesame pull your data from TransUnion and/or Equifax and give you regular updates.
- Experian offers free access to your Experian credit report and FICO score.
- Many banks and credit card apps now include a credit score dashboard, so check if yours does too.
These tools also show you the individual factors that affect your score, like credit usage, payment history, and recent inquiries. They’ll send alerts when something changes — for example, if a new hard inquiry is made, or if your credit usage goes up.
Checking your own credit through these tools is called a soft inquiry, which does not impact your score. It’s a smart habit to log in and check once a month. Over time, you’ll get familiar with how your financial behavior affects your score — and how to keep it trending in the right direction.
What Are Hard Inquiries?#
When you apply for a new credit card, an auto loan, or even a mortgage someday, the lender will do what’s called a hard inquiry — a formal credit check. This shows up on your credit report and can cause a small, temporary dip in your score. It’s totally normal and nothing to panic about.
The key is not to apply for too many credit products at once. Space out your applications, and only apply when you actually need to. Too many inquiries in a short time can make it look like you’re desperate for credit — even if you’re just exploring your options.
Why Some Credit Cards Have Fees — and Others Don’t#
You might notice that some credit cards charge an annual fee, while others (like Adro’s student card) don’t. Here’s why: cards with annual fees often come with luxury perks — think travel insurance, airport lounge access, or premium reward points. These benefits can be worth it if you travel frequently or spend enough to take advantage of the perks.
But for most students — especially those just starting out — a no-annual-fee card is the smartest choice. You can build your credit, get some basic rewards, and avoid paying just to keep the card open.
Adro, for example, was built specifically for international students. There’s no annual fee, no SSN required to apply, and it’s designed to help you start building credit responsibly from day one.
Want to Start Building Credit — Even Without an SSN? Here’s How Adro Can Help#
One of the biggest challenges international students face is getting started with credit — especially when many traditional U.S. banks won’t issue a credit card unless you already have a Social Security Number (SSN) and a credit history. That’s where Adro, our trusted partner, makes a real difference.
Adro is built specifically for international students who are just arriving in the U.S. and need flexible, accessible banking tools — no SSN required upfront. Through Adro, you can:
- Open a U.S. checking, savings, or credit account before even arriving in the country.
- Apply for a no-annual-fee, SSN-optional credit card that reports to credit bureaus — helping you build your credit history from day one.
- Avoid international wire transfer fees, saving money when your family sends funds from abroad.
- Use your card like a debit card by only spending what you already have — a great option if you’re nervous about going into debt.
What’s more, once you do get your SSN later on (through a campus job or internship), Adro will backdate your credit activity so you won’t lose out on months of responsible usage.
Best of all? When you sign up for Adro through Roam and meet a few simple requirements (like depositing $500 and making 5 purchases), you’ll get a $50 bonus straight into your account.
Final Thoughts#
If you’re new to credit and want a safe, student-friendly place to start, Adro is the easiest and most rewarding way to begin. Check out out blog post on Adro and sign up today!
Hey, I’m Amanda! As a fellow international student graduate working with roam, I’ve spent years helping students just like you navigate life in the U.S. roam is all about making your experience as smooth as possible, whether it’s through articles like this, handy tools on our website, or vibrant student communities. Check us out, and don’t hesitate to reach out if you have questions—we’re here to help!