It’s the time of year when students are heading off to college and university for the first time. Some may also have their first credit cards in hand.

“Many students get their first credit card when they begin post-secondary education, so this is the time to educate them on responsible credit use,” says Melissa Jarman, director, Student Banking, Royal Bank of Canada.

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Ensure your clients’ children know how to maintain their credit scores.

1) Myth: There is no harm in paying your bills late, as long as it only happens occasionally.

Reality: Missing even one bill payment can negatively affect your credit rating–this includes your mobile phone, internet and credit card bills.

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2) Myth: Applying for multiple credit cards doesn’t affect your credit score.

Reality: Applying for a lot of credit cards can hurt your credit score, so don’t apply for a card only for the free swag – it could end up costing you more in the end.

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3) Myth: In Canada, your credit rating is affected by your age, income and gender. The higher a person’s income, the better that person’s credit rating will be.

Reality: Your credit rating is based on your record of managing your finances responsibly. Lenders look at how you handle your financial obligations, such as whether you pay your monthly bills on time, carry a balance, or regularly miss payments.

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4) Myth: Checking your own credit will harm your credit standing.

Reality: Checking your own credit history does not affect your credit rating. In fact, it’s recommended that you request a report annually to check for errors.

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5) Myth: Asking for a lower limit on any credit product will help your credit rating.

Reality: Lenders like to see a big gap between your available limit and the amount of credit you’re actually using. Apply for the credit you need and use it responsibly. While it’s best to pay off your balance in full each month, you should always make at least the minimum payment.

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