Purple background with "Family Financial Feuds" and "Managing Credit when Prices are Rising"

As a consumer, you have likely felt the impact of inflation on your wallet, but have you considered how inflation can affect your credit? Costs of various products have gone up, along with interest rates. According to the Consumer Financial Protection Bureau, Consumer Price Index (CPI) for used cars and trucks has increased 40% since January 2021, 12% for new cars, and the average auto loan interest rate for borrowers with a poor credit history is now between 9 and 20 percent annually.

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When I first started using credit, it was exciting and intriguing to learn how I could build and improve my credit over time. At that time, I never thought about how my personal characteristics (e.g., age, accent/nationality, race, gender, etc.) could be used against me. I became interested in fair access to credit several years ago when I started paying closer attention to federal and state guidelines for obtaining credit.

Piggy bank floating in ocean with cloudy weather with Illinois Extension I Block logo in top right corner and wordmark in bottom left corner

When I got my first credit card many years ago, I thought I was ready for all the responsibilities that came with managing this type of credit. Even though I did my due diligence to research the card company and believed I could afford to make my monthly payments, there were a lot of things I didn’t consider. I didn’t realize how having a balance close to my limit would affect my credit score. When I no longer wanted to have credit through that company, I also didn’t think through my rushed decision to close the card.

A man typing on a computer while holding up a credit card

I had a few conversations with a friend who decided to add a loved one to his credit card as an authorized user. Over the years, we had many discussions about some of the challenges he faced building his credit history as an immigrant with a thin credit file. He had been a joint account holder in previous situations, and now he was in a position to help someone else. Like my friend, I have been a primary account holder, joint account holder, and an authorized user, which lead me down this path to talk more to colleagues, do research, and write about piggybacking credit.