Recently, around Verrado, a company has been advertising the importance of credit. The mobile banking app, Step, was started by a pair of financial industry veterans to help teens not make catastrophic money decisions that would affect them for possibly decades. Signing up for 10 credit card offers located around college is a mistake. It’s easy to fall for because of the offers credit card companies promote like free Chipotle are attractive and teens think if they didn’t use the card there was no problem. Open accounts affect credit scores and when you need a loan, like for a car, it might not happen. Step was created to help teens build their credit before they even turn eighteen.
What Step does is use a method that is similar to a normal debit card. Every transaction made on a Step card goes through two instant processes. First, it checks the balance and if there’s enough money in the account it makes the purchase, but simultaneously before it does that it inputs the purchase as a loan. That way the purchase was a loan that was successfully paid off, helping build credit.
When the Step user applies for a credit card like Capital One, all of those purchases will be seen to the banks as paid-off loans, which gives the user a good reputation and boosts their credit score. Having good credit can help save money on things like car insurance, and even student loans. The card also works at any store that accepts Paypal, so it’s not an inconvenience to switch out with a normal daily used debit card.
Verrado High School is in competition with other schools in the district. The school with the most Step accounts will receive $5,000 toward their student government to help pay for the great events they put on.
There are also quizzes on learn.step.com that have six lessons on finance fundamentals, budgeting, credit, loans, and even stocks and crypto for those really interested. The top three students will also get individual rewards of over $1,000 depending on placement. After signing up for Step they also put a free $5 straight into your account, so go sign up and help Verrado! Also for every friend you invite and send a personal link to join, Step will add a dollar to their account and the account holder, so show them this article and spread the word!
This article originally appeared in the Viper Times.