The Average Credit Score in America Is …

|
Average credit score
Image Credit: Dreamstime

Although the U.S. economy has suffered due to the COVID-19 pandemic, many consumers have been able to improve a major component of their financial lives over the past several months.

Average Credit Score in America

Experian’s 2020 Consumer Credit Review says the average FICO Score in the U.S. set a record score of 710, according to data taken from the third quarter of the year. The report says the high score represents a 1% increase (that’s seven points), and it’s the largest boost in 10 years.

Clark’s Magic Credit Score Number

Money expert Clark Howard says if you want financial security, having a good credit score is crucial.

So exactly what is a “good” credit score?

“There are certain breakpoints where things get easier for you,” Clark says. “One that’s really important is being around a 680. That’s a point at which people look at you differently than when you’re below that.”

Beverly Harzog, a credit card expert for U.S. News & World Report says an even higher credit score will yield even more results.

“If you can get up to around a 760, you’re going to get the same benefits, the same offers, that someone who has an 840 score is going to get,” she adds.

How to Increase Your Credit Score

If your credit score is nowhere near those cited above, don’t worry. There are several ways to raise it.

Clark says the two biggest ways to increase your credit score are to:

  • Make all of your payments on time.
  • Keep the percentage of the available credit you use very low. Keep your credit utilization ratio low. That’s the percentage of how much of your available credit you’re using.

When it comes to credit utilization, “30% of your available credit is where you want to be,” Clark says in his podcast. “So, in the example of $10,000 in credit, [you want to have] no more than $3,000 in use. If you go above 50% your credit goes diving off a cliff.”

Ready to boost your credit score in 2021? Follow these five tips.

Advertisement

More Credit Resources From Clark.com:

Advertisement
  • Show Comments Hide Comments