Have you ever been curious about how your credit score stacks up against the national average?
Credit scores vary widely in America based on a variety of factors: age, region, and state, for example, all have specific credit score trends.
In addition, there’s not one single average credit score, as lenders may use multiple scoring models and systems to make their lending decisions.
While the longest-standing credit scoring system is the FICO model, in 2006, the three main credit bureaus — TransUnion, Experian, and Equifax — introduced the VantageScore system.
Both FICO and VantageScore rating scales range from 300 to 850.
Today, as we examine average credit scores in the United States, we’re taking a closer look at VantageScore.
So, what is the average VantageScore? Read on to find out, or skip directly to the link relevant to your query below.
- What’s the average VantageScore by age?
- What is the average VantageScore by state?
- What is the average VantageScore in America?
- What’s considered a good VantageScore?
- How can I improve my VantageScore?
- Remember to regularly check your credit score
1. What’s the average credit score by age?
Using data from Experian’s State of Credit report, we can delve into the differences among different age groups: average credit scores trend upward with each older generation.
Why is this the case? Credit scores are affected by the length of credit history, which means those who are older have a longer credit history and therefore, a better score.
Time is in their favor, as older credit users have had time to recover and learn from past financial mistakes.
Maybe they started out their credit history with a couple of money hiccups like carrying too high of a debt-to-income ratio or missing payments. With enough time and responsible, consistent financial decisions, these mistakes have a smaller impact and good credit can be rebuilt.
Older generations also tend to have a more complex mix of credit, auto and home loans, for example, than those who are younger and have less financial experience. This is another facet of your credit score that gives older people a bigger advantage when it comes to credit scores.
Now, we’ll look more closely at the generational splits in credit scores and debt loads to see where you fall according to your age group’s averages.
Average FICO Score: 631
Born in 1996 or later, Gen Z makes up 26% of the U.S. population. Generation Z comes in with the lowest VantageScore of all of the age groups because they’re young and new to the world of credit. A typical member of Gen Z has an average of 1.29 credit cards each and a fairly low credit debt of $1,682.
While this group doesn’t boast a great score, they do have the lowest average debt of $14,446.
Average FICO Score: 634
Also known as Millennials, this age group makes up the largest percentage of the current labor force. These 20 and 30-year-olds born between 1982 and 1995 have already made a huge impact on the financial landscape.
Millennials tend to be debt-averse overall but still carry an average debt of $32,698.
This group’s credit score is not much better than their younger cohorts thanks to an overall lower amount of spending money and lower employment levels than past generations according to research by Goldman Sachs.
Average Credit Score: 655
Born between 1967 and 1981, Gen X-ers are still a big part of the workforce. They carry around $6,866 in credit card debt and also have the highest revolving credit utilization.
Average Credit Score: 700
Baby Boomers were born between 1947 and 1966. Although many are still in the workforce, a good amount are already spending their golden years enjoying retired life or getting close to retirement. They carry an average of 2.93 credit cards each and have the second highest debt load at an average of $102,000.
Average Credit Score: 730
The Silent Generation was born between 1925 and 1946, the period after the First World War and right before or during the Second World War. This age group is named the “Silent Generation” because members of this cohort came of age during a tenuous time in politics and on the world stage. They strove for stability and weren’t looking to shake anything up.
They have the best credit score out of all the generations despite carrying an average debt of $87,438.
This higher credit score is largely because the Silent Generations members are old enough where their credit scores have had time to recover from any past financial mistakes. Great job, Grandma!
2. What are the average credit scores by state?
State and regional economies in the United States have huge variations in terms of job availability and industry types, so it makes sense that VantageScores would differ along state lines.
The top five national average VantageScore ratings by state include:
3. What’s the average FICO score in America?
With all of this data in mind, what’s the actual average American credit score across all age groups and states? As of 2017, according to Experian’s report, the average VantageScore was 673.
4. What’s considered a good credit score?
According to Transunion, the value of a credit score is ultimately determined by the individual lender.
Typically, the higher your VantageScore, the more confident lenders will be that you can realistically handle and repay your debt.
Transunion provides the following snapshot of VantageScore categories:
It’s important to keep an eye on your credit score, as it affects your financial future — even if it might not seem to directly affect you at the moment.
For example, your credit history determines if financial institutions will approve you for a loan as well as what kind of interest rate you’re qualified to receive based on your creditworthiness.
Bottom line: It pays to have good credit.
5. How can I improve my credit score?
If you’ve compared your VantageScore to the national averages and realized it falls far below, don’t panic. There are many steps you can take that may improve your score in the long run.
- Reduce how much credit you use: If you can’t pay off your balance in full each month, consider paying down as much as you can to reduce your total credit utilization. Even if you pay off your balance in full each month, a high balance might still affect your score. To eliminate this problem, check with your card issuer to see if you can make multiple payments per month.
- Get rid of those small balances: Instead of having small amounts of money over several credit cards, choose one or two that will be your main cards. Pay off those nuisance balances and stick to the workhorse cards for the majority of your purchases.
- Don’t apply for multiple lines of credit at once: Applying for a line of credit causes reporting agencies to do a “hard inquiry” on your credit report, which in turn can lead to a lower score. Multiple hard inquiries may negatively impact your score.
- Pay your bills and rent on time: Making on-time payments can be one of the biggest boosts for your credit score. If you can, set up automatic payments so you’ll never be late.
With these tips in mind, you may be well on your way to a healthier credit score. Remember, it takes time and patience to recover from financial issues, but it can happen.
6. Regularly check your credit score
It’s a good idea to keep an eye on your credit report.
With Turbo, you can gain insight into your VantageScore using data taken directly from TransUnion. Get a quick snapshot of your financial health and stay updated on any changes in your credit report.
Remember, even if your credit score isn’t strong now, you can still build it up. Pay bills on time, watch your credit utilization, and keep tabs on your credit report.