Credit scores are an important part of financial health. They are calculated based on your credit history and payment patterns, and can impact many areas of your financial life – from getting approved for loans and credit cards, to interest rates, insurance premiums, housing applications, and more. But how do credit scores change over a lifetime? Are there certain ages where people tend to have higher or lower scores? Let’s take a closer look at how age can impact credit scores.
How Are Credit Scores Calculated?
Before diving into the relationship between age and credit scores, it’s helpful to understand what goes into calculating a score in the first place. The most commonly used credit scoring model is FICO, which ranges from 300 to 850. Here are the main factors that make up your FICO score and their relative weight:
- Payment history – 35%
- Amounts owed – 30%
- Length of credit history – 15%
- New credit – 10%
- Credit mix – 10%
As you can see, age or length of credit history accounts for 15% of your overall score. The longer your history, the higher your score is likely to be. Let’s explore why this is the case across different life stages.
Young Adulthood (18-24 years old)
In young adulthood, especially the early 20s, people are just beginning to establish credit. They likely have:
- Fewer credit accounts
- Lower credit limits
- Shorter length of credit history
- Potentially limited types of credit (e.g. only student loans)
With less information to draw from, credit scores tend to start on the lower side and have greater volatility. Average scores in this age range include:
- FICO score: 628
- VantageScore: 627
Some actions that can start to build credit at this life stage include:
- Getting a secured credit card
- Becoming an authorized user on someone else’s card
- Paying student loans responsibly
- Limiting hard inquiries on credit reports
While scores are lower, it’s important to note that lenders will take age and limited history into account when evaluating creditworthiness.
Key Takeaways
- Scores start low due to little information and history
- Payment history on student loans can build responsible behavior
- Becoming an authorized user helps establish length of history
Mid-to-Late 20s (25-29 years old)
By the mid-to-late 20s, adults have ideally started to build the foundations of strong credit:
- Established length of accounts
- Mix of credit types (student loans, auto loans, credit cards)
- Responsible payment history
- Moderate utilization rates
Average credit scores climb higher into the good credit range:
- FICO score: 668
- VantageScore: 661
Boosting your score during this time comes down to using credit wisely:
- Keep balances low and pay on time
- Limit new account applications
- Build savings for emergencies to avoid relying on credit
- Watch for errors or fraudulent accounts on credit reports
This is also the life stage when people take out loans for major purchases like cars and homes, which can strengthen your mix of accounts.
Key Takeaways
- Payment history continues to be most important
- Opening too many new accounts can lower scores
- Longer history and mix of accounts raises scores
30s (30-39 years old)
By the 30s, responsible credit usage over the past decade starts to show its positive effects. Scores in the 30s tend to reach their peak, with averages climbing into the very good to exceptional ranges:
- FICO score: 688
- VantageScore: 673
Some factors contributing to the credit score peak around this age:
- 10+ years of established credit history
- Higher credit limits
- Diversity of credit mix from major purchases
- High credit utilization due to mortgages
- Lower credit utilization on revolving accounts like credit cards
To maintain great credit in your 30s:
- Keep low card balances and pay on time
- Monitor credit report errors
- Limit new accounts and hard credit inquiries
- Have a healthy mix of installment, mortgage and revolving credit
For those who may not have established strong credit yet, the 30s are still a great time to build credit responsibly.
Key Takeaways
- Length of history peaks
- Credit mix expands with mortgages, auto loans, and credit cards
- Hard inquiries and new accounts can still lower scores
40s (40-49 years old)
Credit scores generally remain strong through the 40s as long as responsible habits continue:
- FICO score: 690
- VantageScore: 675
Benefits to credit include:
- 20+ years of credit history
- Accounts maintained over decades
- High credit limits
- Paying down installment loans over time
Risks that can lower scores include:
- Closing old accounts decreasing length of history
- Opening too many new accounts
- Taking out new installment loans like personal loans
- Increasing revolving utilization
To keep scores optimized in your 40s:
- Keep old accounts open and active
- Pay down credit card balances
- Limit new credit applications
- Watch for and dispute errors on credit reports
Key Takeaways
- Length of history plateaus
- Long-standing accounts with high limits
- Hard inquiries and new accounts still dent scores
- Keep old accounts open and active
50s (50-59 years old)
The 50s are an interesting age range for credit scores. On average, scores start to decline slightly from the peak decades of the 30s and 40s:
- FICO score: 684
- VantageScore: 670
Some contributing factors include:
- Applying for new credit cards and loans
- Opening department store cards
- Rising revolving utilization
- Accounts falling off credit reports
- Change in income or employment
To maintain strong scores in your 50s:
- Limit new accounts and inquiries
- Actively manage card utilization
- Consolidate debt carefully by comparing impacts on score
- Consider adding your children as authorized users
- Watch for fraudulent activity and errors
The 50s can be a transitional financial period, so monitoring credit impacts is wise.
Key Takeaways
- More accounts falling off credit reports
- Applying for new credit dings scores
- Higher revolving utilization
- Financial changes like retirement or income drops
60s (60-69 years old)
Average credit scores continue to decrease slightly in the 60s relative to younger decades:
- FICO score: 679
- VantageScore: 667
Some contributing factors:
- Change in income or employment
- Accounts aging off reports
- Accounts closed or going dormant
- Taking out new installment loans
- Rising revolving utilization
Strategies to maintain credit health in your 60s:
- Keep old accounts open
- Pay down card balances
- Limit inquiries from new accounts
- Beware retirement financial changes
- Check reports for errors and fraud
While credit trends down, lenders will factor in age and history when evaluating your creditworthiness.
Key Takeaways
- Accounts continue to age off credit reports
- Retirement brings changes to income/assets
- Taking out personal loans for big expenses
- Keep old accounts open and active
70s (70-79 years old)
In the 70s, average credit scores are nearing retirement levels:
- FICO score: 673
- VantageScore: 663
Common impacts include:
- The majority of accounts aged off reports
- Changes to income, assets and employment
- Accounts going dormant
- Rising revolving utilization
- Taking out personal loans
Maintaining credit health in your 70s involves:
- Keeping old accounts open
- Monitoring card utilization
- Paying medical bills responsibly
- Checking for errors on credit reports
- Comparing impacts of debt consolidation carefully
Lenders will take your age and history into consideration when making credit decisions.
Key Takeaways
- Much lower credit mix as most accounts aged off
- Financial changes from retirement
- Medical debt might impact scores
- Keep remaining old accounts open
80s and Beyond (80+ years old)
In the 80s and beyond, average credit scores are nearing the end of the spectrum:
- FICO score: 662
- VantageScore: 655
Typical credit traits include:
- Very few active or open accounts
- Most accounts aged off credit reports
- Changes to income, assets and living arrangements
- Rising revolving utilization
- Medical or end-of-life debt
To maintain credit health:
- Keep old revolving accounts active
- Monitor credit card utilization
- Check for errors on credit reports
- Consider debt consolidation carefully
- Discuss credit impacts of long-term care with family
At this life stage, credit is less of a factor and lenders will account for your age when evaluating applications.
Key Takeaways
- Very limited credit history and mix of accounts
- Most lending decisions focused on income/assets
- Medical or end-of-life debt scenarios
- Keep remaining old accounts open
- Monitor credit reports for errors
The Highest Credit Scores by Age
Now that we’ve explored the credit score trends across the lifespan, let’s summarize the age brackets with the highest average credit scores:
| Age Range | Average FICO Score | Average VantageScore |
|---|---|---|
| 30s | 688 | 673 |
| 40s | 690 | 675 |
| 50s | 684 | 670 |
The 30s and 40s boast the highest average credit scores, generally between 670-690. This is attributed to:
- 15-20+ years of established credit history
- Great mix of installment, mortgage and revolving accounts
- High credit limits
- Low revolving card utilization
- Paying down installment debt over time
So in summary, your 30s and 40s tend to be the golden age for optimal credit, assuming you practice wise credit management through those decades.
Conclusion
In reviewing the relationship between age and credit scores, some key themes emerge:
- Scores start low in your 20s due to limited information
- Payment history builds over time to raise scores in your 30s
- Length of history contributes to peak scores in your 30s and 40s
- Scores fluctuate and gradually decline from 50s onward
- Retirement brings financial changes impacting credit in later decades
While age and length of history play a role, responsible credit management is crucial at any life stage. Monitoring your reports, limiting hard inquiries, paying bills on time, and keeping balances low will help build great credit across the decades. With wise financial habits, your 30s and 40s can be your golden years for optimal credit scores.
