One In Four Millennials Is Clueless About Credit Scores

by Pam on August 28, 2017

A good credit score can unlock many possibilities in your life, making it easier for you to secure a loan, rent an apartment, or start a business. However, according to a recent survey conducted by LendEDU, about 25 percent of millennials do not know what a credit score is. A total of 500 people aged 17 to 37 participated in the poll, which tested their credit score knowledge.

Results of the Survey

In the survey, 74.35 percent correctly identified the definition of credit score. Nonetheless, about 10 percent thought that it is a number assigned to individuals by financial institutions at birth, another 10 percent believed it is assigned by the government for the purpose of tracking banks, and five percent thought that it is a number on a waiting list of credit card applicants.

Although most millennials knew the definition of credit score, a startling percentage of them did not know how to improve their scores. The survey found that 43.69 percent thought that they can boost their credit scores by raising their credit utilization, but the opposite is true. Also, 36.27 percent believed that they can increase their credit scores if they max out their credit cards and then pay back on time.

How to Improve Your Credit Score?

Raising your credit score involves careful evaluation of your credit situation and taking the necessary measures to improve it. First of all, you should get credit reports from the three main credit bureaus, which you are allowed to do once a year at no cost. Look for errors in the reports and dispute them with the credit bureaus if you find any. Additionally, you can improve your credit score by reducing your debt and paying your bills on time. This is easier said than done, but you need to be disciplined if you want to achieve and maintain good credit.

What If You Have a Judgement in Your Credit Report?

If you have defaulted on a loan, you can expect your creditor or a debt collection agency to file a lawsuit against you, resulting in a civil judgement that will appear in your credit report. This judgement can have a significant adverse effect on your credit score. If you want to know how to get a judgement removed from your credit report, it is best that you seek the advice of a financial professional to talk about your individual circumstances.

Improving your credit score knowledge can go a long way in enabling you to improve your credit score. Attaining good credit can be a difficult task, but it is a worthwhile effort nonetheless.

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