The average American’s credit score has been ticking up over the past few years, hitting a record 700 last year. But that strong national average hides a wide age-based range.
There is a 91-point difference between the average scores of those in the oldest bracket of consumers and those in the youngest group, according to a new analysis that FICO performed for MONEY. With each decade, the average score increases by about 20 points.
FICO is the most widely used credit score, a number that’s used to measure individuals’ creditworthiness. Scores range from 300 to 850, and anything above 720 is considered excellent.
While the FICO score calculation doesn’t directly consider age, 15% of the score comes from the length of your credit history—putting younger people at a natural disadvantage. Likewise, 10% of the score is based on the mix of debt you have; it’s better to have a diverse mix—from a mortgage to student debt to car loans—than a single credit card. (And younger consumers are less likely to have a mortgage; the median age of first-time home buyers is 32, a report last year found.)
Read More at time.com