How to Build Credit While on Active Duty

If you're a member of the military on active duty, you might find that building credit comes with some unique challenges — frequent moves, deployments, and limited time to manage finances. But your service also comes with some distinct advantages when it comes to credit. Here's what to know.

Special credit protections for servicemembers

The Servicemembers Civil Relief Act (SCRA) offers financial protections including interest rate caps on pre-service debts, protection from certain foreclosures, and limits on judgments. These protections can help you avoid credit damage during deployments.

Additionally, major credit bureaus offer free credit monitoring to active-duty servicemembers. Take advantage of this to keep an eye on your credit report.

Build credit with the right tools

Active-duty military members can build credit using the same tools available to civilians, but a few are especially useful:

• Secured credit cards — Low-barrier entry, reports to bureaus, easy to manage even during deployments with autopay
• Military-specific financial institutions — USAA, Navy Federal, and similar institutions offer credit cards and loans designed for servicemembers with competitive terms
• Kikoff — No credit check, $5/month, reports on-time payments to Equifax and Experian

Watch your credit utilization

Keep your credit utilization below 30% on all revolving accounts. During deployments when spending is lower, this is often easy to manage naturally.

Make payments automatic

Set up autopay on all accounts before deploying. Payment history is the most important factor in your credit score, and a single missed payment during a deployment can cause lasting damage.

Report rent if you're renting off-base

If you're renting off-base housing, use a service to add rent reporting to your credit file. Every on-time rent payment is an opportunity to add positive history.

Plan ahead for post-service financial goals

Many servicemembers plan to buy a home after leaving active duty. VA loans offer excellent terms, but a stronger credit score still gets you better rates. The earlier you start building, the more options you'll have.

Conclusion

Active-duty service creates unique circumstances, but credit building is absolutely achievable with the right approach. Set up autopay, keep utilization low, and use Kikoff to keep your credit growing on autopilot for just $5/month. Start building your credit today.