I have the money to buy a car for cash. My boyfriend still thinks I should take out a loan. Thoughts?

Your boyfriend is trying to be helpful but is giving you bad advice. You will already have history of payment via the student loan and your credit cards. YOU DO NOT NEED ANOTHER LOAN TO BUILD CREDIT TO MAKE IT EASIER TO BUY A HOUSE. They care about your actual score and your debt to income ratio etc. Having more loans out in the form of a car loan when applying for a mortgage is actually detrimental because they know you owe other people money and in turn that affects how much you can pay for a mortgage payment.

If you really want to improve your credit without paying unnecessary interest on a car loan, call to have your credit limits on your cards raised whatever additional amount they are willing to give you, make sure you never actually use more than 5% of that total limit at any given time, and pay off the balances of your cards in full every month. Time and on time payments with low credit utilization are your keys to building your credit score. I have zero loans of any kind (my former student loans long paid off now) and follow my above given advice, and my credit score is above 800.

CAVEAT: before you pay for a car in cash, I would pay off that 1.5 k student loan IN FULL ASAP, (keeping it around is NOT helping you build credit as much as you might think it is) and ensure you have a healthy 6 month emergency fund on top of whatever you plan to spend for the car.

TLDR: Assuming you have self control, pay off the outstanding student loan asap, get your credit card limits raised, but never use more than 5% of your credit card limit at any time, and pay the full balance of those credit cards every month. Do that and you'll be on your way.

/r/personalfinance Thread