FICO Score Facts and Figures

There are a lot of “Fs” in that headline – just another fact we wanted to share with those interested in FICO® Scores, finances and credit in general. You can tell these facts to your family, friends or co-workers and show them you’re “in the know” when it comes to credit. Or you don’t have to share them at all and just be proud of yourself that you’re learning some new (and interesting) facts.

FACT #1
24% of the U.S. population has a FICO® Score 8 between 670 and 739

That means about a quarter of the U.S. population has a FICO® Score 8 that most lenders would consider “good”. That’s pretty positive news. The even better news is that 20% of the population has a FICO® Score 8 of 800 or greater, a score that lenders consider “exceptional”. And the good news continues, with 23% of the population having a “very good” FICO® Score 8 of between 740 and 799. So, all in all, 67% of the population has a “good”, “very good” or “exceptional” FICO® Score 8.

Oh, wait… there’s the 1% who have a FICO® Score 8 of 850 which is the best score one can have. Which means there’s great FICO® Score 8 news for 68% of the population.

The not so great news? 16% of the population has a FICO® Score 8 lower than 580 which most lenders consider “poor”. However, the promising news for this group is that there are opportunities to improve one’s credit score.

FACT #2
The average U.S. household with revolving credit debt pays $904 in interest annually.1

Simply stated, this means almost $1,000 a year is used by the average U.S. household to pay only the interest on their revolving debt. The primary reason? Cost of living has outpaced income growth. Not to mention that over the past decade, medical expenses have increased 34%, food and beverage increased by 22% and housing costs went up by 20%.2

The average medical spending per person is $1,054.2  Where’s that money supposed to come from? For many, it is put on a credit card and if there are problems paying off the card in full, interest charges kick in. As the experts say, the best way to free yourself from having debt affect your budget is to find a way to pay off the highest-interest debt you have as soon as you can.

FACT #3
About 42% of the population has a credit report indicator showing a “30 days or greater” missed payment

With the hectic pace of life these days it’s possible we might miss a loan payment. Missed payments that appear on credit reports as “currently past due” are troublesome because the more “recently” the missed payment took place, the more they tend to impact one’s chances of getting credit. A single payment missed months or years ago won’t impact your credit as much as more current payment problems. However, late payments can remain on credit reports for as long as 7 years and the longer a bill goes unpaid, the more probable it is that you can be denied credit and/or be charged higher interest rates if you are approved. This is why setting up automatic payments for your monthly bills can be one of the smartest financial decisions you’ll ever make.

FACT #4
ID Theft happens once every 2 seconds. 3

Yes, you read that right. Every 2 seconds someone becomes a victim of identity theft. This might help that statement make more sense: In a common calendar year, there are 31,536,000 seconds. Divide that number by two (every two seconds) and you get 15,768,000 which matches the statistic that over 15 million U.S. consumers were victims of identity theft or fraud in 2016.4   And the number is growing.

All these calculations and facts aren’t really “fun”, but the real intention here is to remind you to keep an eye on your credit and monitor it for signs that an identity thief might be using your identity for their own financial gain.

FACT #5
People have an average of 5 credit cards reported in their credit report.

Sure, that’s a “fun” fact to know (for some of us), but what does it really mean? Are 5 cards too many or too few? Is there an actual “best” number of credit cards to have on one’s credit report?

Let’s use this statistic to start: On average, FICO® High Achievers (those with a FICO® Score 8 of 800+) tend to have 7 cards which include open and closed cards plus accounts that carry and don’t carry balances.

But hold on, before you start applying for (or canceling) cards to reach 7, it’s important to note that these High Achievers have an average of 4 credit cards or loans with balances. Another important point is that High Achievers also have a well-established credit history (on average, 25+ years) and the age of their most recently opened credit account averages 28 months. So while 7 might be the best number of credit cards for some, you must take into consideration all of the factors that make up your FICO® Score before opening or closing any of your accounts.

People share facts, stories and offer advice at myFICO forums all the time. Check them out for yourself and show all your friends how much you know!

 

1 http://money.cnn.com/2017/12/13/pf/credit-card-debt/index.html

2 https://www.nerdwallet.com/blog/average-credit-card-debt-household/

3 https://www.lifelock.com/education/15-facts-you-have-to-know-about-identity-theft/

4 https://www.usatoday.com/story/money/personalfinance/2017/02/06/identity-theft-hit-all-time-high-2016/97398548/

5 https://www.creditcards.com/credit-card-news/too-many-cards-1586.php

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Rob is a writer… of blogs, books and business. His financial investment experience combined with a long background in marketing credit protection services provides a source of information that helps fill the gaps on one’s journey toward financial well-being. His goal is simple: The more people he can help, the better.

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