Average Credit Score by Age

Once I came across the concept of average credit score in US which is estimated to be 693 and goes on changing by every state and region. Well, the average credit score is influenced by the economic activity that takes place in the region and also the average income of the people. The average credit score in US is thus influenced by several economic factors.

The Basics about Credit Ratings

Your credit score by FICO credit score range, extends from 550 to 770, 550 being lowest or the poor credit score. This numerical value is derived on the basis of a mathematical formula which has been derived by FICO. The formula takes into consideration, 5 different aspects of your credit related dealings, namely payment history, amounts owned, the length of credit history, new credits which have been borrowed and lastly the type of credit that has been borrowed.

The lenders and credit card companies from whom you borrow regularly report your bill payments and installments to the credit reporting agencies such as Experian, TansUnion and Equifax. Upon the reporting the formula that has been mentioned above, gets reapplied and your credit score changes accordingly. Thus, in short the more timely installments and bills you pay, the better is your credit score going to be as every timely installment tends to increase your score.

Now, if you look at the formula, you will notice that there are several things that will influence your credit rating. The following are some important credit rating related points that you should bear in mind while using credit:

• 35% of your credit report, rating and score is made up of a payment history, hence making timely installments and borrowing credit only when it is required is needed is of essence as it will boost your overall credit score.
• 30% of the score is made up of the total amounts that you actually we to the lender, thus the more you owe the less is your score going to be. Hence, make it a point to pay off debts on time and again, borrow only when it is absolutely essential.
• 15% of your score is made up of the length of the total credit report. A long report is bound to invite a negation in the score.
• 10% of the report is made up of your new borrowings, hence borrowing in a controlled and well thought out manner would be healthy for your credit rating.
• 10% influences the type of credit that you use, well this is pretty much out of your control, but avoid borrowing subprime credit cards, loans and debts.

Overall, a wise use of credit cards and loans is recommended to have really good credit score.

Overview of Average Credit Score by Age Group

Age Group	Average Score
18 - 29	637
30 - 39	654
40 - 49	675
50 - 59	697
60 - 69	722
70 plus	747

There are a couple of good permutations that we can take a look while considering credit score as per age. The first that we must know is that when a person take a credit card or a loan for the first time, then he or she has a 'no credit' status that is there is no credit history, score, rating and report. As the time succeeds, the report grows longer. Now if this same person handles the credit cards and loans maturely, then he or she has a good credit report and score, which goes on getting better with time and succeeding payments (assuming that they are made on time). However, on the other hand, if the person blunders the payments, then he or she has a bad credit score.

Hence, if you ask, can a young person have a good credit score, the answer is yes, but rarely. If the question is, can an old person have a good credit score, the answer would be again yes, in most cases, save a few.