I don’t have a perfect credit score.
That sentence sounds like I might be admitting something truly dark and terrible, right?
But here’s the thing: After five years of writing about my finances, I can confidently say I’ll never have a perfect credit score — and you likely won’t either! Let us all rejoice in our imperfections.
Here’s why, beyond a certain point, a perfect score doesn’t matter.
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What is a perfect credit score?
Your credit score is a three-digit number calculated by the credit rating companies in your country — at least, that’s true in North America, anyways. A perfect credit score in Canada is a cool 900.
But my score has always hovered in the high 700s, topping out at an all-time high of low 800s.
And I’ve never been too worried about pushing it higher, even though I was deeply the person who would have thought an 88% score was “only OK” in school. (That admission is truly more embarrassing than telling you I’ll never have a perfect credit score, but I’ve also accepted that it’s very on brand for me.)
How is your credit scored?
Whether your score is 600, 900 or a Nick Miller 250 that prevents you from getting a cellphone, it’s not a number that’s pulled out of thin air. It’s based on a fairly standard set of criteria, which you can see when you compare the lists that the two major credit bureaus publish on their websites.
(And for my fellow New Girl fans, you don’t actually get 150 just for being alive. Scores actually start at 300 in Canada.)
Equifax says your credit score is based on:
- Your payment history
- Your used credit versus your available credit (that’s your “utilization”)
- The length of your credit history
- Public records
- The number of inquiries into your credit file
TransUnion has a very similar list:
- Your track record for repaying your loans and credit card balances
- How much money you currently owe on your credit accounts
- How long your accounts have been open
- The different types of credit you use or credit mix
- How much credit you use compared to the amount of credit you have available
- How often and how recently you have applied for credit
Those are the inputs, but the actual calculations to turn those pieces of data into a three-digit score assigned to you as a human being are kept behind closed doors, for the most part. Algorithms, ya know? They rule everything around us.
But I don’t need to see the calculations to know why my score is “only” 88% perfect.
I only have some types of credit
There’s a lot of credit in the world. You can have credit cards, or a car loan, or a mortgage, or a home equity line of credit, or student loans or even a cellphone contract. Yes, your two-year iPhone contract counts!
But personally, I’ve only ever had a few, especially in the past few years. I have a mortgage and I have credit cards, but I’ve never had a car loan or a line of credit, and I’ve bought my last few phones outright. (Can’t tie me down, cellphone companies! I do what I want.)
Even when we took out a loan for our most recent car, we put it in my husband’s name only since I had just started a new job and we didn’t want to update all of our paperwork with the bank.
Your credit score is partially based on whether you’ve shown that you can successfully pay back multiple types of credit. Since I’ve only had a few, my score is naturally docked a few points.
I have less than a decade of credit history
On top of that, I only got my first credit card when I was 22 — and I closed that card a few years ago when it wasn’t the right fit for my life anymore. My oldest credit card right now is only about four years old, closely followed by my mortgage, which just celebrated its third birthday with us.
The age of your credit accounts helps show a history of Being Good At Credit, which is what your score is really trying to quantify. My history is fine, but it could be longer, and it’ll get longer with time. Having the right credit products for me was more important than optimizing for a marginally higher score.
But crucially, I still have a good score
I know, because I check it every so often when my Borrowell emails pop up in my inbox. I signed up for their free credit monitoring after accidentally signing up for a $16-a-month credit monitoring service I didn’t need with another company, and being like “Excuse me, rude” when I realized I was paying for it.
For the past few years, I’ve had Borrowell keeping track of my score for free in the background, and whenever I get curious I just log in, see that it’s still in the very high 700s (because I pay my bills on time consistently and maintain a low credit utilization!) and I carry on not worrying about it.
Living the dream over here.
I’m comfortable with my very good (not perfect) score
The biggest reason I’m more than OK with my credit score is that as much as it’s a score, it’s more of a tool. It only really matters in the context of what it can help you do.
Once you have a good (or great!) score, your credit score isn’t going to stand between you and doing the things you might want to do, like nabbing a great rewards credit card, getting a mortgage or landing a dream apartment.
A lower score could reasonably prevent you from doing those things, so working to improve it by changing your credit habits and situation can be hugely beneficial. But once you hit a solid score, working to get it even higher just doesn’t make a big difference — if any.
And sure, anecdotes are not Real Data, so take this with a grain of salt. But I’ve never seen a single difference between the credit rates and opportunities available to my husband and me, even though his score is routinely ~30 points higher than mine.
(Yes, he’s irrationally proud of it every time it comes up. And even so, I still just can’t be bothered to care about boosting my already-very-good score.)