University of Minnesota Duluth block M and wordmark

What’s in your credit score?

  • Credit is the availability of money you have not yet earned.
  • Credit Score is a snapshot in time, represented by a number between 300-850, showing your responsibility as a borrower.
  • Credit History shows management of credit through your lifetime.
  • Credit Report includes balances, payment history, account age, and some demographic information. It’s like a money resume.

There are 5 components to your credit score.

1. Payment History

Late payments are the quickest way to ruin credit. Pay early or on time. Don't miss a due date - schedule time for bill paying.

2. Utilization

Aim to spend within 35% of your credit limit and pay your bill in full. Example: If your credit limit is $1,000, never spend more than $350 at any time.

3. Length of account age

The longer you've had each credit account the better. Opening multiple accounts at once can lower your score. Avoid impulsive decisions to get a good deal at the check-out.

4. Inquiries

Retrieving a hard copy of your credit report will take a few points from your credit score each time. Look at your credit report annually to check for errors or if shopping for a major purchase.

5. Mix of credit types

Having multiple types of credit is best. Examples: Credit card, Mortgage, Student Loan

Know yourself: If overspending is a problem, limit credit to installment loans only, like a mortgage.

While it is possible to repair a credit score after making a mistake, it can take up to seven years (or more) to do so. Educate yourself now on what counts, start making the right moves, and rest assured that you’re in a great credit position.

If you’re ready to develop a great credit score, click yes!