Lessons From the Credit-Score Elite

Want to improve your credit score? Try taking a page from the best. Credit scorer FICO recently reviewed the profiles of consumers it calls high achievers—those with scores in the 750-to-850 range. Adopting some of their habits could boost your score into the stratosphere and keep it there.

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The most influential factor is a record of on-time bill payments. According to FICO’s study, 72% of those with scores between 750 to 799 and 95% of those with scores of 800 or higher have no late payments (overdue by 30 days or more) on their credit reports. If you occasionally overlook a bill, sign up for automatic bill payments or put reminders on your calendar, suggests Heather Battison, vice president for credit agency TransUnion.

The amount that you owe on your credit cards as a proportion of your total card limit—known as your credit utilization ratio—is another important component. High achievers with scores from 750 to 799 use a median 10% of the credit available to them, and those with scores of 800 or higher use just 4%. “There are no hard-and-fast rules,” says Can Arkali, principal scientist at FICO, but in general, the lower your utilization, the better. Even if you stop using a credit card, keep it open so that your score benefits from the available credit. However, if the card tempts you to overspend or carries an annual fee, closing it may be better.

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A long history of credit usage also elevates your score. The average age of revolving credit accounts among high achievers is a little more than nine years for those in the 750-to-799 range and almost 12 years for higher scorers. If you are just starting to establish a credit history, set yourself up for success by using a credit card to make small, manageable purchases, such as gas and groceries, says Battison.

For more valuable lessons from the credit-score elite, see my slide show 7 Habits of People With Excellent Credit Scores.