What Is a Good Credit Score?

How Students Can Manage Their Credit Scores
How Students Can Manage Their Credit Scores

When it comes to your credit score, you may be wondering what a good credit score is? A good credit score is anything above 670, according to FICO. However, this isn’t the only thing you should consider when looking at your credit score. It would also help to look at your credit utilization rate and the percentage of your total available credit that you are currently using.

Ideally, you want this number to be below 30%. Another factor to consider is your length of credit history. The longer you have had a credit account open and in use, the better it is for your credit score.

If you are starting with credit, don’t worry – there are ways to improve your score. One way is to make all of your monthly payments on time. Financial factors in your life, such as whether or not you’ll be able to lease a vehicle, qualify for a mortgage or even land that fantastic new job.

And considering 71 percent of Canadian families carry debt in some form (think mortgages, car loans, lines of credit, personal loans or student debt), good credit health should be a part of your current plans.


How your credit scores are set

Your credit score is a three-digit number that lenders use to determine how risky it is to lend you money. The higher your credit score, the less risky it is for a lender to loan you money and the more likely you will get a lower interest rate on a loan.

Many factors go into calculating your credit score, including how long you’ve had credit, how much debt you have, and how often you pay your bills on time. As a result, your credit score can range from 300 (the lowest) to 850 (the highest).

A good credit score is anything above 700. If your credit score is below 700, you can do things to improve it, such as paying your bills on time, reducing your debt-to-income ratio, and maintaining a high credit utilization ratio.

Pro Tip: You can view sample credit score summaries from each bureau (see Equifax and TransUnion here) to get a sense.


What’s in a number?

How Students Can Manage Their Credit Scores
How Students Can Manage Their Credit Scores

In Canada, What’s in a number? Quite a lot. Especially when it comes to your credit score, your credit score is one of the most critical numbers in your life. It can impact everything from your ability to get a loan or mortgage to the interest rate you’re offered on a credit card.

But what is a good credit score? And how can you make sure yours is as high as possible? A good credit score is typically anything above 700. Anything below that, and you may have difficulty getting approved for loans or mortgages.

You may also have to pay higher interest rates on any debt. However, there are several things you can do to improve your credit score. One of the most important is to make sure all of your bills are paid on time.


How to go from good to excellent (or bad to good)

It’s a question that has plagued people for centuries: How can I go from good to great? Alternatively, how can I go from bad to good? There are many schools of thought on the matter, but one tried, and accurate method is here.

The first step is to identify what it is you want to achieve. Once you have a clear goal in mind, it’s much easier to map out a plan of action. For example, if your goal is to improve your credit score, you’ll need to start by understanding what makes up a good credit score.

Then, you’ll need to work on fixing any negative marks on your credit report and building up your credit history. This may take some time, but you’ll eventually see results if you’re patient and stay focused on your goal.

. Many different issues can hurt your credit, such as:

  • Late or missed payments.
  • Too many (or too few) open credit accounts.
  • High credit card balances.
  • High balances on loans.
  • Too many credit applications.

According to the Office of Consumer Affairs, only your creditors can alter the information on your credit file. When it comes to building good credit, there are no shortcuts.

Here’s the good-to-great news: Improving your credit health isn’t only achievable, but the steps involved can help you establish an overall healthy financial life. Read our tips for simple ways you can improve your credit health.


Bottom line

Your credit score is essential. It can determine your interest rate on a loan, whether you can get a loan, and even how much you pay for car insurance. Your credit score is one of the most important factors lenders look at when considering a loan application. So what makes up a good credit score?

There are many different scoring models, but a good credit score is anything above 700. Scores below 600 may indicate that you’re a high-risk borrower and could have trouble getting approved for a loan. A good credit score isn’t just about getting low-interest rates; it also indicates that you’re responsible with money and likely to repay your debts on time.

If you’re not happy with your current credit score, there are things you can do to improve it. Start by checking your credit report for errors and correcting them.