What is the earliest age you can get a credit score?

Whether you’re nearing the end of school, or you’re the parent of a child who is considering applying for financial products, understanding the basics of credit scores is essential to avoid hurting a credit report before you’ve even started your first full-time job.

At what age does a credit report begin?

In short, an Australian credit report may begin at 18 years old. But there are a couple things to keep in mind.

In Australia, if you want to apply for any financial products, such as a credit card, car loan or a home loan, you’ll need to meet certain eligibility criteria around age. Legally, you must be 18 years or over to be eligible for this type of product.

But it’s not just credit cards that come with these regulations. When you apply for a post-paid mobile phone contract (mobile plan), this too is considered applying for credit. The telco will perform a credit check on the applicant, and they will need to be 18 years or older. This is also the same for utilities, such as gas and electricity. For your name to sit on a gas bill, for example, you will need to be above the age of 18. 

All this to say, in Australia, the earliest age you can get a credit score is 18. This is the age you are legally considered an adult and can begin applying for financial products, as well as phone plans and utilities.

However, a credit report may not formally begin until an individual starts to apply for these products. This is why young adult Australians may find that they do not have a credit history despite being 18 or over, as their parents are still the account holders for more accessible credit products, like a mobile phone plan.

Tips for building your credit score when you’re a young Australian

If you’re nearing 18 or want to start improving your credit score to increase your chances of approval for financial products, there are a few steps you can take to improve your credit history and boost your score.

1. Start small. You’re less likely to be approved for a credit card without some credit history. It may be more appropriate to start with credit products that have eligibility criteria that is easier to meet, such as putting a mobile phone plan under your own name, or having your name added to a utility bill.
2. Pay on time. You’ll want to get into the habit of paying on time, as young as possible. Add reminders to your phone or set up direct debits so that you never miss a bill deadline. Positive credit behaviour such as this may reflect well on your credit score. Plus, it helps to establish good behaviour and may help you avoid late payment penalties or default further down the road.
3. Don’t make multiple applications. Every time you apply for a credit product, the provider will perform a hard credit inquiry into your credit history. Credit inquiries let providers see your credit behaviour to determine if you’ll be able to service their product. But the hard inquiry will also show up on your report. If you start making multiple credit card or loan applications to hedge your bets about being approved, this may hurt your chances. Providers will see that you’re making multiple applications and consider you a riskier customer.
4. Joint applications. Generally, you need to be approved for a financial product to begin boosting your credit score with good financial behaviour, but often you won’t be approved in the first place if your credit history is short, making it a catch-22. If your credit score is less than stellar due to your having a short credit history, you may want to consider having a family member with an excellent credit score to go guarantor or co-sign an application with you. By having this additional person join your application, their credit history and personal information can boost your chances of approval.