What Is A Good Credit Score For the Average American?

Without a good credit score, it is hard to qualify for loans in the States. This is particularly when it has to do with a major purchase which costs thousands of dollars. Unless you are willing to pay out of pocket for big purchases, financing big purchases through loans is the way to go. A good credit score for the average American working class adult means having access to good creature comforts.

I know it sounds unfortunate, but you and I know access to some creature comforts is not possible on some average working class salaries. Creature comforts like car, an apartment, house or even property purchase needs you to have a great credit score in order to qualify for a loan finance to afford them. Am I right?

In the United States of America, credit is king. Your ability to repay a debt is rated with a number called a credit score. The credit score is gotten from an accumulation of the adult’s credit history over a period of time. I discussed this on what you need to know about credit and credit score. You can read it to get a glimpse of how the system work, otherwise the summary below explains the five levels of credit scores.

What Are the Five Levels Of Credit Scores?

In the United States, your credit worthiness is rated into five levels. These five levels are summarized below:

Credit Score	Ratings
300-579	Poor
580-669	Fair
670-739	Good
740-799	Very Good
800-850	Excellent

As a working class adult, good financial institutions will considered you for a loan when your credit rating is from 670 upwards. It is considered to be good for any borrower. If you could get into the excellent ratings, that is even better.

The maximum credit score limit is 850. This is the highest credit score you can achieve. You would have to be excellent in repaying debts to get up to this point.

Before I elaborate more on this, the American credit system is divided into two. You have the FICO credit system and the Vantage credit system. Banks use FICO for financial transactions pertaining to loans, while businesses like rentals usually access the Vantage system.

What Is the Highest FICO Score And Vantage Score?

The highest FICO score you can get is 850. That is considered the perfect FICO score. How rare is an 850 FICO score?

For the average American working class adult, I would say it is very hard to get or maintained the highest FICO score. But, what matters is being within FICO score ratings which are favorable to you as a borrower.

If you want to maintain an exceptional FICO score though, you have to stay within 800+ range. With high FICO score like that, you can easily get loans as long as you have a steady income flow. Now, here is what to know about Vantage score.

The highest possible Vantage score is 850 too. Vantage credit score model uses the same metrics as the FICO. Personally, I prefer using the FICO to check my score since most financial institutions use it for credit inquiry.

What Does High Credit Score On the Five Levels Of Credit Scores Mean For You?

A high credit score means low interest rate, when you ask a bank to finance your purchases. A high credit score is considered a good credit score for financing a car. Not that you will not qualify for a loan within the fair credit ratings of 580 to 669, but the loan will be given to you with a higher than average interest rate. This is especially, when there are blemishes on your credit report.

You can read where to check your credit score for free for how to go about seeing your credit score and history.

A good credit score starts with 670 credit ratings. With 670 credit score, you are considered to be risk free. If your credit score is above 740 and in the 800’s, that is even better. Now, does your credit score represent you as a person?

No, your credit score does not represent you as a person. You may still be a risk factor. This is especially without a job or a steady monthly income flow. Also, having a habit of owing debts and a history of missed debt payments make you a risk. Yes- these are considered by banks when they decide to finance a purchase for you.

Sometimes, errors in credit reports could cause your credit score to fall. In case of errors causing your credit score to fall, you could dispute errors on your credit report. Having said that, here is what to know about the average American credit score by age currently and where you should strive to be.

What Is A Good Credit Score By Age?

According to Experian, one of the three biggest credit bureaus in the US, the 2022 and 2023 data below represents the average American credit score by age:

Age	2022 Data	2023 Data
78+ years old	760	760
589 to 77 years old	743	745
43 to 58 years old	707	709
27 to 42 years old	687	690
18 to 26 years old	679	680

As you can see from the above table, credit score for the average American Gen Z’s and Millennials were in the 600’s. I am not surprised. This is because the more one ages, the better grip one has on his or her finances. Simply put, you pay your bills on time and become responsible with your debts. Would you say the above data is a reflection of this fact?

I would think so.

As young working class adults, we are easily influenced to spend more than we can afford. It could be from maxing out our credit cards to missing a monthly debt payment. The average working class adult earning power is not strong enough to offset continuous debt accumulation. Hence, why our credit score is easily affected negatively.

Additionally, adult Gen Zs and early Millennials may not have much of a credit history. This is given the fact they have not built any yet. As a result, their credit scores are not expected to be good. But, do that mean you cannot have a respectable credit score?

No. You do not necessarily have to be confined to these average credit score by age. Your credit score depends on your credit history and credit building ability. You can read Building Credit For the First Time to know how you could get a good credit score.

Credit Score For An Apartment

A good credit score is important, since it gives access to needs like a roof over your head. You may not believe, but it is hard to get an apartment with a bad credit history. Landlords and apartment complexes tend to run a background on renters.

Does it matter?

Oh yes. To these rental businesses, it is another way of sieving through liabilities. By liabilities, I mean renters who have a history of owing rent. They are bad business for apartment or house rental businesses.

For the average workin class adult, having a credit score beyond 670 puts you in good standing with landlords. It basically says you are financially responsible. There are benefits that come with it too. You are more likely to have a lower deposit than someone with bad credit and credit score.

Does it mean credit score in Fair ratings will not get you an apartment, my good reader?

You can still get an apartment with a fair rating credit score. This is especially, if your credit and rental histories are good. It is just that sometimes, apartments will want you to put down a high rental deposit during application.

I talked about it on What Credit Score Do You Need For An Apartment podcast episode. Be sure to check it out, since it tells how this could help qualify for apartment discounts. Speaking of the credit score for an average American, here is what you need to know about the score to buy a car.

What Credit Score Is Needed To Buy A Car?

Speaking of a good credit score, the average young working class adult in America surely needs it to finance a car. If not, the interest rate of any car finance is higher than the usual. Or even worse, you may not be able to get any bank to finance your car purchase.

I remember the first time I walked into a dealer to purchase my first car- a Toyota corolla, I had a difficult time getting financed by a bank. This is because I did not give much thoughts to building my credit prior to going to the dealership.

How much credit score do you need to buy a car?

As a working class adult, I can tell you having a fair to good credit range makes lenders consider you for a car loan. This is especially, when you have a steady income flow in a job you have worked for at least six months. Yes- you need at least six months so lenders see you can maintain a job that long.

You can read What Credit Score Is Needed To Buy A Car. I elaborated more on this issue. Perhaps, you will learn from my experience.

What Would Drop A Credit Score the Most?

There are a number of things damaging to a credit score. The largest impact on your credit score is missing your monthly payments to existing debts. If you read What Ruins Your Credit Score the Most, I discussed how debt has a huge impact on your credit score. This is whether you are paying off a debt or accumulating one.

Debts have a big impact on your credit score, because it is how your credit history is built. When you accumulate a debt or pay it back, it is recorded as part of your credit history. It is not just your ability to pay back debt, which could affect your credit. Your income-to-debt ratio can also influence it negatively.

Here is a good example below.

Maxing out a credit card could be seen as negative event on your credit report. Its impact goes beyond just affecting your credit score. It increases interest rates, which may make it hard for you to pay back your debt. Therefore, decreasing your credit score further.

As you can see, you need to get at least 670 to qualify for loans with a reasonable interest rate. You have to be on top of your debts to achieve this. Not only paying debts on time, but making financial decisions which are not reported negatively on your credit report. It is how you set yourself up for financial success as a young working class adult in the United States.