You know that your credit score is important. It determines the path of your financial life. This is exactly why you review your credit report at various times. You try to lower your credit-utilization ratio and pay off your debts. It is good that you check your credit history from time to time. However, do you know that experts from the credit industry are keeping a close watch on you? In fact, they are monitoring the credit behavior of several consumers in groups. They observe the way in which the consumers behave in a particular area. In short, they try to understand the attributes and their effects on credit score.
After a detailed study of the attributes, the credit experts have come to a conclusion that smokers in the state of Texas have lower credit scores than serene women in Wisconsin. Keep it in mind that these attributes only co-exist with your credit score. They don't actually influence your credit score. To explain it more lucidly, these attributes are not used to calculate your credit score.
Read along to know about 3 traits that often co-exist with your credit score.
1. Your age is between 19 and 29.
Statistics reveal that people born in the 1980's and 1990's have poor credit score. According to a recent report published by Experian, the average credit score of these young adults is 672. On the other hand, the average credit score of the people above 66 years is 829. Credit scores of the baby boomers are even better. Their score is around 782.
Young adults are just starting their financial journey. They don't have long credit histories. Their credit-utilization ratio is also high. They are not well-equipped to handle credit. They learn the clever tactics and strategies to handle credit with time. All these factors lead to lower credit score.
2. You don't have patience. You're restless.
According to a recent report published in The Journal of the Association for Psychological Science, people with less patience have lower credit score. No one is denying the fact that several factors lead to irregular payments of debts. For instance, job loss, reduction in income, expensive medical treatments, etc. However, the major factor that leads to irregular payment is impatience.
Lack of proper payments has some serious consequences. Some of them are
- Huge money at the present moment
- Huge debs in future
- Higher payments later on
- Poor credit score
Impatient men tend to make poor financial planning. They are more concerned about the present moment. They forget to make the debt repayments within the due date. As such, their credit score drops in future.
3. You love to inhale cigarettes at various times in a day.
If you can't live without taking a puff of a cigarette in a day, then your credit score is likely to go down by nearly 30 points. You may be wondering about the co-relation between your smoking habit and credit score. After all, how can a pack of cigarette affect your credit score?
Well, research has shown that smokers are unable to control their desires and this affects their financial decisions. They tend to take huge risks which adversely affect their credit score.
Quit smoking for a certain period of time. You'll have better control over your wishes and desires. This in turn will have a positive impact on your score.
Finally, women beat men when it comes to credit score. Women have better credit score than men. The average credit score for males is 675. This figure is 7 points less than that of the women. Men carry a higher debt load then women. This single factor makes the women winner and men loser.