Consumers Attribute Better Credit Behavior to Checking their Credit Score
Frequently checking your credit score could help you develop better financial habits, according to a survey by Discover that was released today.
73% of those who check their credit score regularly (seven or more times a year) say that habit is improving their credit behavior, including paying bills on time, paying down loans and maintaining low balances on their credit cards. Only 44% of those who checked their score once a year felt the same way.
The study also found the respondents who checked their scores in the prior year boosted their score. Again, those who check their score regularly made the most improvements. 72% of those who checked it four to six times reported higher scores. Only 38% of those who checked it once bettered their score.
Many credit card issuers now offer free credit scores to their cardholders.
“Checking your credit score is one of the simplest things that anyone can do to get on the path to understanding their credit health,” said Julie Loeger, executive vice president and chief marketing officer at Discover. “But checking is just the first step. One of the reasons we launched Discover Credit Scorecard is to help people stay on top of their credit by gaining more knowledge of key factors that go into their score.”
In general, Millennials (ages 18 to 34) reported a more personal connection to their credit. Nearly half (46%) said they link their credit score to their self-worth, compared to 43% of GenXers (35 to 54) and 30% of Baby Boomers (55 to 69). 64% of Millennials also said they associate their credit score with a sense of freedom, compared to 56% of GenXers and 40% of Baby Boomers. Millennials are also checking their credit scores more often and working to improve their standing.
The survey also explored consumer attitudes about how their credit impacts their lives. 82% said they are aware of their credit standing, and most (74%) said their standing was important to them, though only 54% said it effected their day-to-day life.
In fact, while 81% know that credit has an impact on their ability to purchase a home, they did not understand the influence it could have on other matters. Many believe their credit score has little to no impact on their ability to get a job (64%), get a favorable insurance rate (47%), rent an apartment (47%), obtain a personal or student loan (32%), get a credit card (29%), or buy or lease a car (25%).
The study surveyed 2,000 consumers, aged 18 and older.