In an article about credit score, students sitting down and talking

What Is the Ideal Credit Score for Students?

It's just one number, but it can have a big effect on your life.
July 5, 2020
7 mins read

Credit scores are primarily based on how you’ve managed your past debts. For students, they might not have realized its importance yet because they’re more focused on academic responsibilities and possibly have little to no credit.

However, that is not to say that every student does not have a credit history. Some might already have used credit to purchase or acquire something, while others are adults pursuing education once again.

If you are just in the starting phase of your credit journey and thinking about your credit score, note that credit scores vary due to many factors. Here’s a closer look at what’s considered a good credit for a student.

A Good Credit Score Among Students

In the FICO® scoring model, credit scores range from 300 to 850. For anyone, specifically students, a credit rating of at least 700 is considered a good score, but a bad credit score can be between 300 and 579. As mentioned, credit scores vary, depending on how you managed your past debts and what’s on your credit history.

The most popularly used credit scores are FICO® Scores. These scores are computed using a distinct algorithm that assesses and examines the features of your credit report, which generates a three-digit score.

To build or maintain a good credit score, you must ensure that you know which features of your report matter most in calculating your credit score. FICO® Scores are computed by weighing five elements on your credit report:

— Length of Credit History: For younger students, this aspect might be tough. The longer your credit history, the better. You might want to get a credit card now or ask your relative to make you an authorized user on their credit card. These approaches will help you kick-start your credit history.

— Payment History: Payment history is one of the essential aspects of your credit report that significantly affects your score. As you start to build your credit, make sure to pay off all your bills on time. A late or missing payment can have adverse effects on your credit score.

— Recent Activity: This aspect refers to the number of new credit applications you have applied for over the last 3-6 months. If you have too many credit applications in a short period, lenders may see it as a red flag and an indication of poor financial management. Hence, limit the number of credit applications you apply for in a short period.

— Credit Utilization Ratio: It is computed by getting the quotient of the total debt you have on your credit card and the total amount of your credit limits. The credit utilization ratio can vary each month. Hence, if you are just starting your credit journey, be wary of how much available credit you use every month. It’s advised to keep your credit utilization ratio to at most 30%.

— Credit Mix: This aspect refers to the various credit accounts you have in your credit reports, such as student loans, credit cards, etc. Many might have a hard time in this category since younger consumers who are just starting their credit might not have enough experience with different loan types. Even if the credit mix serves a small part in your score, it is something to consider as you start to build more credit.

Why Students Would Want To Have A Good Credit Score

A good credit score can help students who are planning to leave school or those who are currently in school get their first credit card, finance their school expenses, rent an apartment or buy their first car.

Lenders use your credit score to determine if you are a good borrower. Those with stellar credit scores are usually offered the best interest rates, which can help them save more money in the long run.

Remember that there’s more to your credit than your credit score. It may be tempting to work to obtain the best credit score you can. However, now is also the best time to learn the skills needed to keep a good score over time and develop responsible financial habits.

Most students have used student loans to support their schooling, and it can be an excellent place to start when it comes to establishing responsible financial habits. Just make sure to pay your student loan on time to refrain from getting any late fees.

How to Build Credit as a Student

When it comes to building good credit, it’s important to start early. Young students can use time as their advantage and start building their credit as soon as possible. Here are ways to build good credit:

— Get your own credit card.

— Use the credit card for small, occasional purchases.

— Make on-time payments.

— Do not cosign for your colleagues.

— Don’t apply for too many different credit cards over a short period.

— Ask your parents to add you as an authorized user on their cards.


Having good credit is important because it will help you qualify for different loans and make you financially independent. As a student, take advantage of time to build your credit profile and commence life after college with a rosy financial health and positive credit score.

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