Bank Deal: Earn 1.00% APY on an FDIC-insured savings account at Barclays Bank.
I wrote the other day about the relationship between delinquency rates and FICO credit scores, but I didn’t really touch on what all goes into determining your credit score. According to Fair Isaac (the company responsible for FICO scores), here’s a rundown of what goes into your credit score, and the relative importance of each component:
Payment History – 35%
Amounts Owed – 30%
Length of Credit History – 15%
New Credit – 10%
Types of Credit Used – 10%
So if you want to maintain a high credit score, you’ll obviously want to pay on time and keep your credit utilization low (i.e., keep your balances low relative to your credit limits). It’s also a good idea to keep old cards open even if you don’t use them — after all, this increases the average age of your cards, and also decreases your utilization.
Clearly, applying for a bunch of new cards to take cash in on 0% balance transfers, free credit card miles, or cash signup bonuses can negatively impact your FICO score, but it’s a relatively small hit when compared to things like payment history and outstanding balances.
- How to Become a Millionaire
- How to Get Out of Debt
- The Best Dollars I've Ever Spent
- How Our Estate Plan is Structured
- How We Paid Our Mortgage In Less than 10 Years
- Money Making Ideas
- How to Manage Your Asset Allocation with Multiple Accounts
- Consumption Smoothing - Save While the Saving's Good
- How to Save on Groceries
- How Much Life Insurance Do You Need?
- Eleven Great Books About Money
- Dave Ramsey is Bad at Math (692)
- Dish Network Customer Service SUCKS (534)
- $8,000 Homebuyer Tax Credit (429)
- Pay Off Mortgage Early or Invest? (424)
- How to Claim the First-Time Homebuyer Tax Credit (352)
- Termite Control: Sentricon vs. Termidor (325)
- How Much Should You Pay a Babysitter? (284)
- Ethanol Blended Gas = Lower Mileage? (272)
- Reduced Credit Limits? Share Your Experience (256)
- $15,000 Homebuyer Tax Credit (242)
- Buying Furniture off the Back of a Truck (228)
- Will Mac OS X Lion Kill Quicken 2007? (191)