Your Credit Score is Your New GPA

You’ve thrown your cap, but you’re not done with GPAs. As an adult, your credit score is your new GPA, and it’s important to have a good one.

What is a credit score?

Your credit score tells you how risky lenders think you are. Colleges used your high school GPA to gauge your likelihood of success in college. Lenders use your credit score to determine whether you’ll repay a loan.

If this evaluation intimidates you, don’t worry.  The single most important component of your credit score is paying your bills on time.  That’s right.  Fully 35% of your credit score is your “payment history.”  You can move to the head of the class by staying organized!

Here are the factors that determine a score:

FICO credit score graph

What does your credit score do for you?

Having a great credit score isn’t just about making lenders love you. A top score earns you the best financial deals from lenders and others.

Do you want to move? Landlords love tenants with a solid credit history. Need to refinance student debt? People with good credit scores will find lower interest rates. Want to buy a car?  People with good scores get the best car loan rates.

Next Steps

When it comes to your credit score, don’t hit the books but do check out the Web. The company that invented the credit score – FICO – has all the information you need to understand and improve your score. Visit and click on “Learn About Scores.”

Study now and you could have Summa Cum Laude credit later.

To learn more about the book Money in Your Twenties click here.