How to Build Credit as a Stay-at-Home Mom

If you’re a stay-at-home mom, your main job is to give your child or children the best life possible. However, it’s important to take care of yourself, too. If you don’t have your own income, you might wonder how you can build credit.

Fortunately, there are many ways to maintain or improve your credit score, even if you aren't working for pay right now. Here’s a closer look at how women can build credit as stay-at-home moms.

How to build credit as stay-at-home moms

If you want to start building credit as a stay-at-home parent, here are a few tips to help you get started.

1. Put bills in your name

If your spouse or significant other is the primary breadwinner, you can still put some recurring payments under your name. For example, many landlords report rent payments to credit agencies. If you make payments on time, you can build credit using this strategy.

2. Apply for credit with your spouse

As a stay-at-home parent, you can build credit by cosigning a loan with your partner. If your family needs any of the following types of loans, consider applying together:

• A mortgage
• An auto loan
• A personal loan

When you apply jointly, the lender will look at your total household income, not just yours. They will also look at both of your credit scores. 

Payments on these loans may come from your spouse’s income, but they can still help you build your credit. However, before you apply for any kind of credit, make sure that you are on the same financial page as your partner. If you cosign a loan and your spouse makes a late payment, both of your credit scores will be negatively impacted.

3. Become an authorized user

If your spouse or another family member has good credit, consider asking to be added as an authorized user on their credit card. This simple step can make a big difference when it comes to boosting your credit score.

However, just like with cosigning a loan, you should make sure that the account owner will reliably make payments and won’t overutilize the card. If they’re not responsible with their own credit, they could damage your credit score, too.

4. Use a credit-builder app

Credit-builder apps are another way women can build credit as stay-at-home moms. Each app works slightly differently, but generally, the process goes like this:

• You apply, and if you’re approved, you can access a small loan or credit line
• You use the credit to fund purchases
• You make regular payments in the app
• The app reports the payments to credit bureaus, helping to increase your credit score.

Kikoff is a credit-builder app that extends no-interest lines of credit to users. You use your credit line to make purchases in the Kikoff store and pay them off over time. 

For a small monthly fee, you can access many of our services through our basic membership plan. If you choose to upgrade to one of our premium plans, you could take advantage of additional credit-building features like the Kikoff secured credit card and rent reporting. 

When you apply, we don’t do a hard credit check, so you don’t have to worry about temporarily lowering your score.

Can stay-at-home moms build credit without a job?

Your work as a mother may keep you inside the home, but you can still protect your credit and be prepared for whatever the future brings. Although many factors go into determining your credit score, your income isn’t one of them. 

Credit scores are determined by these five weighted factors:

• Payment History: 35%
• Credit Utilization: 30%
• Length of Credit History: 15%
• Credit Mix: 10%
• New Accounts and Hard Inquiries: 10%

While your income doesn't determine your credit score, it can impact your ability to get loans or credit cards. 

Suppose that you apply for a car loan. Your credit score is excellent, and your partner's income is enough to keep your family comfortable. However, since you have no income, your application will likely be denied. Lenders want to verify that you can repay what you borrow. This means that your partner will likely have to cosign the loan.

How marriage and joint finances affect your credit

Knowing how mothers can build credit as stay-at-home moms is important to your financial future. If you’re married or have combined your finances with your significant other, you should also understand how joint finances can have an impact on your credit score.

Some people believe that once you get married, your credit report merges with your spouse’s. This is not true, and marriage alone won’t impact your credit. However, if you share a credit account, that account will appear on both of your credit reports and can therefore affect both of your credit scores.

Here’s an example. Imagine that you get married to your long-time partner. At the time of your marriage, your spouse has significant debt that lowers their credit score. This debt has no effect on your credit.

Now, imagine that you and your spouse get a new credit card together. Your spouse quickly racks up debt and maxes out the card without your knowledge. You end up missing two payments because you can’t afford them. 

Even though your spouse was the one who overspent, the high credit utilization and the missed payments will appear on both of your credit reports because you share the account.

Conclusion

If you’re a stay-at-home mom who wants to build or improve your credit, Kikoff is for you. We aim to make building credit straightforward, and it only takes minutes to get started. Open your account today!