Think you don’t need to worry about your credit score in your twenties? Think again.

Young adulthood may seem like a time for carefree self-discovery, but it’s also a moment to build a strong financial future. Many young adults struggle with their credit; student loans and a difficult job market don’t make it any easier.

Bankruptcy is increasingly common for millennials — our Chapter 7 lawyers in Memphis TN have helped many of them file — and doing it early gives you so much freedom in the years ahead. Here are my thoughts on why strong credit matters when you’re young — and how bankruptcy can get you back on the right course.

How Good Credit Makes Life Easier in Your Twenties

It can potentially save you thousands on your student loans.

Every year, more and more Americans are burdened by student loan debt. The average student loan debt for Class of 2016 graduates was $37,172, 6% higher than the year before. Strong credit can help alleviate it in some cases. Refinancing could give you a lower payment or interest rate, but you usually need a credit score of 690 or higher and regular income.

It will cut car insurance costs, too.

In many states, car insurance companies can determine your monthly payment from your credit score. According to recent analysis from NerdWallet, the annual car insurance price increase for poor credit in Tennessee was $971 — $81 a month. Healthy credit habits can help you qualify for cheaper car insurance.

You could find it difficult to find a home without it.

Whether you’re renting or buying, credit score factors into the process. Property managers screen prospective tenants, often running their credit history. Poor credit could lead to a bigger deposit, or even denial of your application altogether. If you’re buying a home, you need good credit to get the best rates on your mortgage.

It could even affect your utility expenses.

Utility companies want to know you’re trustworthy enough to pay for the electricity, water, and gas you use. Bad credit can be a red flag, and they can insist on a deposit depending on your credit history.

File For Bankruptcy When You’re Still Young

It may feel overwhelming, even upsetting, to consider bankruptcy at a young age. But I’ve worked with hundreds of clients who are millennials, and I’ve watched bankruptcy set them up for a strong financial future. You can prevent so much future pain by doing it early.

Some of my younger clients worry that bankruptcy will hurt their credit in the years ahead. But if you’re considering filing, your credit probably isn’t in the best shape, and bankruptcy will benefit your credit in the long term. We offer a free program to our clients, 7 Steps to a 720. It takes work, but you can get there even within a year of bankruptcy.

Talk to Chapter 7 Lawyers in Memphis TN Today

If you have questions about bankruptcy, our Chapter 7 lawyers in Memphis TN want to hear from you. Contact us here or call (901) 327-2100 for a free consultation.