Ah, credit scores. The elusive number that can either make or break your financial dreams. It’s like trying to figure out how to properly fold a fitted sheet – you know it’s important, but it’s just so darn confusing. If you’re wondering what the average credit score is, you’re not alone. In fact, according to a recent study by Credit Karma, only 38% of Americans know their credit score.
What’s the average credit score?
As of 2022, the average credit score in the United States is 714 (according to Experian data). This number can vary based on a multitude of factors, including age, income, and location. But why is your credit score so important, you may ask? Well, for starters, it can determine your ability to get approved for loans, credit cards, and even apartments. It can also affect the interest rates you receive on those loans and credit cards, which can end up costing you a pretty penny in the long run.
But how is your credit score actually calculated?
The three main credit bureaus – Experian, Equifax, and TransUnion – use a combination of factors to determine your score. These factors include payment history, amounts owed, length of credit history, credit mix, and new credit. Payment history and amounts owed make up the bulk of your score, so it’s important to stay on top of those credit card bills and loan payments.
Want to improve your credit?
First and foremost, make sure you’re paying your bills on time and in full. You can also consider opening a credit card or taking out a loan, as long as you’re able to pay it back in a timely manner. And if you’re really serious about improving your score, you can try using a tool like Brigit’s Credit Builder*.
Brigit’s Credit Builder can help you build your credit by reporting your on-time payments to the credit bureaus. This can help you establish a positive credit history and improve your score over time.
*Impact to score may vary. Some users’ scores may not improve. Results will depend on many factors, including on-time payment history, the status of non-Brigit accounts, and financial history. Results show that customers with a starting credit score of 600 or below were more likely to see positive score change results.
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