Help Me Go INTO Debt so I can get Good Credit? -

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A reader says he needs debt to achieve his goals. Is he right?

Question: I have been reading your question-and-answer columns for a while now. I have not seen anyone with my problem. It is the opposite from most of the people who write to you.

These people usually ask you how to either get out of debt themselves, or they have significant others who they are trying to convince to get out of debt.

But I need to get into debt. I just need to know the best way to do it.

I am 24 and work as a plumber. I am well paid. I never went to college, so I have no student loans. But I want to buy a new car and a house one day — but I can’t even get a credit card! I keep getting denied. I think it is because I have no credit history.

Everything I read online says to take out a personal loan or get something called a secured credit card. Is that an option? I thought that’s for people in debt?

This is a weird question, isn’t it?

— Ryan in Nevada

Howard Dvorkin answers…

Not weird at all, Ryan. In fact, this is quite common.

It certainly seems weird on the face of it, seeing as how this country is mired in debt. When the average credit card debt per household tops $15,000, and when the average student loan debt is nearly $30,000 per borrower, who worries about not having enough debt?

The answer: young people without a credit history.

Three years ago, I was interviewed by The New York Times on this very topic. What I told the reporter then is still true today: “Having no credit history can be as detrimental, or worse, than having a bad credit history.”

It’s true. If you have no credit history, lenders are reluctant to hand you money — because you have no track record of paying back a loan.  If you have a poor history, at least it gives lenders a benchmark. They’ll surely charge you more interest for a loan, but they’re not completely in the dark.

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Around the same time I spoke with The New York Times, had a 19-year-old intern who couldn’t get a credit card.

“Even though I pay all my bills on time, I face the same problem as people who never do,” wrote Lulu Ramadan. “We can’t get a credit card, a car loan, or a mortgage.”

What did Lulu do? She asked her parents to become an “authorized user” on their credit card account, which helped her slowly build credit. Another option is what you alluded to, Ryan: a secured credit card.

Yes, these cards are for people in debt. They’re really not credit cards at all, because you must give the issuer a refundable deposit. That becomes your credit limit. In essence, you’re charging against your own money.

Why go through this process? Because lenders will look favorably upon a secured card user who pays his monthly bills on time. Coincidentally enough, they also look favorably upon secure-card users who have no previous credit history.

So which card do you choose?’s credit card expert reviewed several such cards. Check out The 6 Best Credit Cards That Help You Build Credit. Once you establish a good payment history with a secured card, you won’t have any trouble getting a “real” credit card.

If you pay the balance in full each month, soon enough you’ll have an excellent credit score. A car and a house won’t be far behind. Good luck, Ryan, with your not-so-weird problem!


Have a debt question?

Email your question to and Howard Dvorkin will review it. Dvorkin is a CPA, chairman of, and author of two personal finance books, Credit Hell: How to Dig Yourself Out of Debt and Power Up: Taking Charge of Your Financial Destiny.

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Meet the Author

Howard Dvorkin, CPA

Howard Dvorkin, CPA

CPA and Chairman

Dvorkin is the author of Credit Hell and Power Up and Chairman of

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