A credit score of 720 or higher is typically considered excellent credit. That’s great news for the roughly 38% of us with scores in this top tier of the standard 300 to 850 credit-score range, according to WalletHub data. Excellent credit can save you a lot of money each year, not to mention make it easier to find an apartment or even a job.
You can quickly determine whether you’re part of the excellent-credit crowd by checking your credit score for free on WalletHub.
Below, you can also learn more about excellent credit, from how to get it to what it gets you. Just remember that whether or not excellent credit translates into significant savings depends on the rest of your financial profile as well as your particular lender’s standards. Lenders are the ones who make the final call on creditworthiness, after all.
Do I Have Excellent Credit?
The average person’s credit score is 668, which qualifies as good but not excellent. The following table will tell you a bit more about what sets good and excellent credit apart and how to determine where you stand.
| Info | Excellent Credit |
vs. |
Good Credit |
| Score Range |
720 to 850 |
660 to 719 |
|
| Qualifications | ALL of the following must apply: 1) Have 5+ years of credit-card/loan experience 2) Have $10K+ in available credit; 3) Never been 60+ days late on a bill; 4) Never declared bankruptcy |
ALL of the following must apply: 1) Have 3+ years of credit-card/loan experience 2) Have $5K+ in available credit 3) Not been 60+ days late on a bill in the past 12 months |
Tip: Check out the Credit Analysis section of your WalletHub account, where you’ll find letter grades for each component of your credit score. Those grades will tell you which areas to work on to ensure your score stays excellent. Bear in mind that you don’t need straight A’s to get an excellent credit score, but you need to be close.
What Excellent Credit Gets You
According to WalletHub calculations, excellent credit is worth thousands of dollars per year in savings on everything from credit cards and car loans to mortgages and insurance policies — relative to bad credit. Even the step up from the average American’s credit score of 668, which is classified as “good,” could potentially provide hundreds of dollars in annual savings.
Not only that, but excellent credit also has the potential to open many important doors, offering invaluable opportunities in the process. You can get a sense of just how much excellent credit figures to help you from the following table.
| Item | Do You Qualify? |
|---|---|
| Any Credit Card | YES |
| No Annual Fee Credit Card | YES |
| Big Initial Credit Card Bonus | YES |
| Credit Card with 0% Financing | YES |
| No Foreign Fee Credit Card | YES |
| Favorite Store’s Credit Card | YES |
| Airline/Hotel Credit Card | YES |
| Mortgage | YES |
| Auto Loan with 0% Intro Rate | YES |
| Lowest Auto Insurance Premiums | YES |
| Personal Loan with the Best Term & Rate | YES |
| Apartment Rental | YES |
How To Get Excellent Credit
There is no secret to building an excellent credit score. All you really need is multiple credit cards or loans that you use responsibly for an extended period of time. Above all else, that means making on-time payments, using only a modest portion of your available credit and avoiding unnecessary debt. On the other hand, irresponsible habits could lead to payment problems and a variety of so-called derogatory marks on your credit report.
With that being said, there are a few additional tips that we can share to help you cross the 720 credit score threshold and ultimately reach top WalletFitness:
- Pay Before The End Of Your Billing Cycle: Setting up automatic monthly credit card payments from a bank account is the best way to prevent forgetfulness from hampering your credit-improvement efforts. Scheduling these payments for a few days before the end of your billing cycle, when your monthly statement is generated, will also help improve the credit-utilization portion of your credit score.
Credit utilization compares your outstanding balance on the statement date to your overall credit limit to show how much of your available credit you’re using. So by minimizing your statement balance, you’ll also be improving your utilization and thus benefitting your credit score. Plus, you can always schedule another payment just before your due date in order to avoid carrying a balance completely.
- Monitor Your Credit: A free credit monitoring service such as WalletHub’s will help you catch potential credit-report errors and signs of fraud before they can do any real damage to your wallet. But that’s not the only type of monitoring we’re talking about.
You should also make it a practice to review the grades on the Credit Analysis portion of your WalletHub account. This will give you an understanding of what’s required to either reach or maintain excellent credit.
- Build A Robust Emergency Fund: No one can predict the future, and the good times don’t always keep rolling. That’s why it’s a good idea to take certain precautions, particularly setting aside some money for rainy days. With a nice chunk of change acting as a safety net, you’ll be less likely to miss payments and default on debt if you lose your job or encounter some hefty unexpected expenses.
For more tips on how to whip your credit score into excellent shape, check out our helpful Credit Improvement Guide.
Image: Andrew Rich / iStock.
