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Key Takeaways:

• A credit score is a three‑digit number (300–850) that reflects your creditworthiness.
• Payment history and credit utilization make up 65% of your FICO^® Score.
• You can improve your credit score by paying on time, lowering balances, reviewing your report, and using credit responsibly.

What is a Credit Score?

A credit score is a three-digit number between 300 to 850 that represents your creditworthiness. It’s calculated using information in your credit report, including payment history, balances, account types, and more.

Even if you’re married or apply jointly for a loan, your credit score is always individual to you.

What Is a Good Credit Score?

To help you understand your score, the average U.S. FICO^® Score is 715. Scores naturally fluctuate with economic trends and often increase as people age and build longer credit histories.

How FICO^® Rates Credit Scores Ranges:
• Very poor: 300 - 579
• Poor: 580 - 669
• Fair: 601 - 660
• Good: 670 - 739
• Very Good: 740 - 799
• Exceptional: 800 - 850

What Your Credit Report Includes

Your credit report contains your personal information, credit accounts, payment history, account balances, inquiries, and any public records such as bankruptcies or collections.

How To Check Your Credit Report

You can check your credit report for free each year through AnnualCreditReport.com — and many people review it more frequently to monitor for errors or fraud. 

Why Your Credit Score Matters

Your credit score directly affects the interest rates and terms you receive on major financial products such as mortgages, auto loans, student loans, and credit cards. A higher score saves you money; a lower score may lead to higher costs or even denial.

What Impacts Your Credit Score

Several factors come together to form your credit score, each one reflecting a different part of your financial behavior. Understanding these components makes it easier to know where to focus if you want to strengthen your score.

• Payment History (35%)
  Your track record of paying bills on time is the single most important factor in your FICO^® Score. 
  • Lenders look for consistent, on-time payments.
  • Missed or late payments can significantly lower your score.

• Credit Utilization (30%) 
  This measures how much of your available credit you're using at any given time. 
  • Aim to keep balances below 30% of your credit limits.
  • Lower utilization shows lenders you manage credit responsibly.

• Length of Credit History (15%) 
  The longer your accounts have been open, the more positive impact they can have.
  • Older accounts help demonstrate long-term responsible borrowing.
  • Closing old accounts may shorten your average account age.

• Credit Mix (10%) 
  Lenders prefer to see that you can manage different types of credit.
  • A combination of credit cards, installment loans, and mortgages can help.
  • A limited credit mix isn't harmful, but variety can boost your score over time.

• New Credit (10%)
  Opening too many new accounts in a short period can signal financial strain.
  • Multiple hard inquiries may temporarily lower your score.
  • Space out applications when possible.

How to Improve Your Credit Score?

Improving your credit score is a steady, step-by-step process. By building strong financial habits and monitoring your progress, you can gradually strengthen your profile and qualify for better interest rates and loan terms. 

• Review your credit report regularly
  • Look for errors, outdated information, or unfamiliar accounts.
  • Disputing incorrect items can sometimes lead to immediate improvements.

• Protect your payment history
  • Set up auto-pay or reminders to avoid missed payments.
  • Even one late payment can have a long-lasting impact.

• Lower your credit card balances
  • Paying down revolving debt reduces your utilization percentage.
  • Prioritize high-interest balances first when possible.

• Keep older accounts open when appropriate
  • Long-standing accounts support your length of credit history.
  • Only close accounts if fees outweigh the benefits of keeping them open.

• Increase your credit limit strategically
  • A higher limit can reduce your utilization rate - if your spending stays the same.
  • Requesting a limit increase works best if you have a positive payment history.

Building Long-Term Credit Health

A strong credit score isn't built overnight - it grows through consistent habits and smart financial choices. By monitoring your progress and taking small, steady steps, you can strengthen your credit profile and open doors to better financial opportunities.