Do yourself a favor and check your credit score
This time of year is one of my favorites: fall, football and reviewing your finances,
As we enjoy the fall foliage, apple cider and doughnuts at Schutt’s, and pumpkin-related events all across the Rochester area, we’re also right around the corner from holiday season.
It’s no surprise that we’re also heading into the time of year when we spend more money than any other season. The National Retail Federation predicts that the average household is expected to spend nearly $1,000 this winter shopping season.
So checking your financial status now will help you be prepared — and flag any warning signs — before you really start spending around the holidays.
Part of financial planning is knowing and understanding your credit score — and there’s some good news about credit scores lately. According to Experian data from the third quarter of 2020, despite the overall economic decline, the average FICO score in the U.S. climbed 1% (seven points) in 2020, reaching a record score of 710.
Compared to the average growth seen over the past 10 years, the 2020 increase is unusually high. And a July 2021 VantageScore report showed that the average credit score in America is 697. For New Yorkers, the average is even higher at 704.
Before you check your credit score, it helps to understand what it’s made up of: your payment history, balances, utilization (loan or credit card balances compared to limits), length of credit history, recent credit activity and types of credit.
As a rule of thumb, most lenders will give the best interest rates to people with a FICO score of 740 or greater. Under special circumstances, like buying your first home, credit score standards might be lower. It's always a good idea to ask your lender what the credit score requirement is before you apply.
Visit the website for any of the three major credit bureaus (Experian, Equifax or TransUnion) to check your credit score, even if it has been a while. Knowledge is power.
If your score is in line with the national average and you saw an increase, great. If you aren’t excited about the number you see, your score isn’t locked in. It takes time (and discipline) to increase your credit score, but you can make improvements. And we can help you on that journey.
We’ll leave you with this: Check your credit score right now while it’s top of mind. We encourage our members and neighbors to pull their credit report at least annually to make sure it’s accurate. It doesn’t hurt your score, and knowing your number and credit history can do wonders when you need it.
A time when you need it would be like buying a first or new home, or if you’re in the market for a new car. Or maybe you’re just getting ready for some good old-fashioned holiday shopping.
Celeste A. Kier is senior vice president and director of marketing and customer experience at ESL Federal Credit Union.
This article originally appeared on Rochester Democrat and Chronicle: Holiday season a good time to check your credit score
