You can find a ton of free information online about your credit scores and your credit reports. However, most of the information you can actually gather are sometimes vague and cannot be used as a good basis to understand what credit scores are and how important it is in debt management.

Credit scores are different from credit report contrary to the typical notion of most people. These two are entirely different and far from each other.

The credit score is based upon the credit report. Credit scoring is just a simplified method of identifying good credit risks from poor credit risks. You can bet that lenders will get a credit score before they proceed with the loan process but before a loan process goes very far, the lender will get full credit reports and from all three of the credit reporting agencies.

The credit score is also based on credit history. One third of your credit score consists of your payment history, so get in the habit of paying your bills on time and you will have one third of a good credt score already. Employment history and monthly or annual compensation is also used as a determinant. If you have a good credit history, chances are you will be provided with points you can use for other purposes.  If not, you should work learn how to repair your credit profile.

You can consider your FICO score to be a snapshot of your credit report at that time the lender looks at it.

Some people believe that if they stay out of debt and pay in cash as they go, they will have a good credit score and a good credit report, but that is just wrong. They will have no credit history, no credit score, and no credit report. Without these things, you cannot establish to have a good credit report.  You should learn how to repair your credit profile.

The fastest (and least expensive way) of building credit history is to get a credit card, make charges, and then pay them off before any interest is added.  You can earn rewards for buying stuff with rewards credit cards and then paying off the charges each month. 

But if have never had a credit card, get one with a $500 limit or less so you cannot get into too much trouble.  This way you won’t start off with a bad credit score and credit report.