Good credit score saves money

How much money could you really keep in your wallet if you improved your credit score?

Even if you have good credit, relatively small shifts in your credit score can make a big difference in the rates you pay. And, what seems like a small difference in monthly payments adds up over time.

Gail MarksJarvis, author of "Saving for Retirement without Living Like a Pauper or Winning the Lottery," asks: "What if you could invest that money in a simple mutual fund that covered the entire stock market and left it until you were approaching retirement?" Historically these funds have earned on average 10 percent per year. Investing even $100 per month of money saved, thanks to a better score, over the course of 40 years adds up to over $559,500.

Use this chart to see exactly how much money you could save on a mortgage, a home equity loan and a new car if your FICO credit score was higher.

Mortgages Home equity loans Auto loans

Mortgages Figures reflect national average rates for $165,000, 30-year fixed mortgage. Credit score Interest rate Monthly payment Savings earned if score was high** 760-850 6.274% $1,019 0 700-759 6.496% $1,042 $8,627 660-699 6.780% $1,073 $19,788 620-659 7.590% $1,164 $52,336 580-619 8.905% $1,316 $107,234 500-579 9.899% $1,436 $150,192 ** The amount one could save over the life of the loan if credit score was 760 or higher. Rates as of June 12, 2007, from myFICO.

Does your credit get high marks or do you feel like you're flunking out? Share your story.

-- Posted: June 18, 2007