Ah, your first credit card. That whopping $1000 limit means the world is your oyster for the next month. It may be tempting to visit every store in your neighbourhood or treat yourself to a little retail therapy, but there’s something else you need to worry about. Your credit score.

I know, I know. It seems like you’re a little too young to have to worry about all that. You can always improve your credit score in the future, right? Well, sure, but the future sneaks up faster than you think. The last thing you want is to be a 20-something with a low credit score.

Now, before jumping into why you should want to build credit, let’s briefly break down what a credit score even is. Essentially, it’s a number out of 900 that determines how likely banks are to give you a loan or an additional credit card. It reflects how likely you are to repay your debt and tallies how many times you’ve had a good rating. According to Credit Karma, a good score is usually between 670 and 739.

It’s never too early to start building your credit rating, especially because building it to a good score takes time. As soon as you get your first card you need to think about maintaining a good rating. Poor credit scores mean:

• You’ll have difficulty renting or buying property. It might not seem like a big deal now, but eventually you’ll want to move out of your parents’ house. A bad credit score can chase away a lot of potential landlords.
• Your chances of getting additional credit cards are pretty slim. If banks see that your score is bad with one card, why would they take the risk of giving you a second one?
• Loans won’t come as easy either. Some banks may charge you high interest rates while others might turn you down entirely.

Luckily for you, there are some tips you can follow on how to build your credit score from the moment you get it.

For starters, get a simple card. With so many different options out there, it can be overwhelming to decide which card is right for you. But, a starter card with no annual rates and low interest rates is the way to go. As nice as it would be to have a $10,000 cap on your card, you don’t need that kind of money to start with; $500 to $1,000 is a good base.

Credit cards need to be monitored as well. Sign up with sites like Credit Karma and receive notifications to your email when a new score is ready. Keep an eye on the numbers so you know where to make improvements. Anything from not paying bills on time to applying for too many loans in a short period of time can lead to a significant decrease in your score. You also have to consider what your “debt to income ratio” is; how much income you make in comparison to how much debt you have can also affect your credit rating ( including when you apply for a bank loan or credit increase).

Maintaining a good credit score isn’t hard once you know the basics. Don’t go crazy with the spending and think about your future self to ensure that you’ll have an easier time when those milestones in life approach.