Do you have an excellent credit score? A lot of people can achieve good credit scores by practicing responsible financial habits, such as making on-time payments, but it takes a little extra knowledge — and some credit card savvy — to take your credit score from good to excellent.
Is having excellent credit worth it? Absolutely. Credit scores make up a huge part of our financial lives, so it’s to your advantage to learn how to get your credit score as high as possible—and getting an excellent credit score is just about as high as you can go.
How do you know if you have excellent credit? What is an excellent credit score and is there an easy way to get it? Let’s take a closer look at what is considered an excellent credit score, as well as what you can do to boost your credit score into the excellent range.
What is an excellent credit score?
According to the FICO credit scoring model, an excellent credit score falls between 800 and 850 points. FICO, or the Fair Isaac Corporation, operates one of the most popular credit scoring systems in the industry, and myFICO.com reports that over 90 percent of top lenders use FICO credit scores to help them make lending decisions.
If your credit score falls within the excellent credit score range, your credit is as good as it gets. Yes, you could try to achieve a perfect credit score, but you don’t need to actively work on building your credit the way you might if you had fair credit or bad credit. Instead, you can focus on maintaining your excellent credit score by practicing the responsible credit habits that helped you earn your score in the first place, like paying your bills on time and keeping your balances low.
What are the credit score ranges?
What is an excellent credit score range? How does it compare to the other credit score ranges? Here’s a breakdown of the five FICO credit score ranges, including the points that fall within each range:
FICO Credit Score Ranges
The FICO scoring system occasionally refers to the top credit score range as “Exceptional” — but don’t worry, that means the same thing as “Excellent.” If you have excellent credit, you don’t need to do anything else to get exceptional credit. You’re already there!
What are the factors that impact your credit score?
The FICO credit scoring model uses five factors to determine your credit score: payment history, credit utilization, credit history, credit mix and recent credit applications. Let’s take a closer look at how each of those factors impacts your credit score:
Payment history (35 percent)
This is your history of on-time payments. If you have excellent credit, you’re probably very good at making on-time payments — but if you ever accidentally miss a credit card payment, act quickly to keep it from affecting your credit score. Making on-time payments consistently is one of the best ways to maintain a stellar credit.
Credit utilization (30 percent)
Your credit utilization ratio is the amount of credit you’re currently using compared to the amount of credit available to you. If you have excellent credit, you probably have a lot of available credit because you keep your balances low or pay them off in full every month. That’s great for your credit score. Keeping a low credit utilization — below 30 percent at least, but ideally within single digits — is another surefire way to keep a strong credit standing.
Credit history (15 percent)
This is the age of your open credit accounts. If you’ve been successfully maintaining credit accounts for a long time, your credit score is likely to get a boost. This is one of the reasons why it’s a good idea to keep old credit cards open even when you are no longer using them regularly.
Credit mix (10 percent)
Your credit mix is based on the different types of credit accounts under your name. If you have both revolving credit (like credit cards) and installment loans (like a car loan), your credit score could go up.
Credit applications (10 percent)
Your credit score is also impacted by your recent credit applications. If you apply for a lot of credit all at once, lenders might wonder if you are planning on going into a lot of debt — and whether you’ll be able to pay off that debt in the future. This is why hard credit inquiries, which occur every time you apply for a new credit card or loan, can prompt a temporary drop in your credit score.
Steps to improve your credit score
If you want to learn how to get an excellent credit score — or if you already have excellent credit and want to work toward that perfect 850 — here are some steps you can take to improve your credit score.
Start by making on-time payments every month, if you aren’t doing so already. Since 35 percent of your credit score is based on your payment history, making on-time payments is one of the best things you can do to boost your credit score.
Next, start paying down your balances. The lower you can get those balances, the more available credit you’ll have — which is good for your credit utilization ratio and even better for your credit score. As the Washington Post reports, people with perfect credit scores have an average credit utilization rate of 4.1 percent. That doesn’t mean they never use more than that much of their available credit; it just means that they pay those balances off every month, and keep any revolving balances very low.
You can also increase your available credit by requesting a credit limit increase or applying for a new credit card. If your credit already falls in the Very Good range (740-799), going online and requesting a credit limit increase on one of your existing credit cards might give you the point boost you need to take you over 800.
Lastly, you’ll want to track your credit score on a regular basis — here is our advice on how to get a free credit score — and review your credit reports to ensure that all of the information is accurate and up-to-date. Understanding how your credit score fluctuates based on your outstanding balances, new credit applications and overall credit history can help you make adjustments that will benefit your credit score both now and in the long run.
Benefits of having excellent credit
There are numerous financial benefits of having excellent credit. When you have excellent credit, you can access the best credit cards on the market — including the top travel credit cards, the best cash-back credit cards, the best credit cards for dining out and more. Your excellent credit score will make you an ideal candidate for luxury credit cards like the Chase Sapphire Reserve® card or The Platinum Card® from American Express.
Excellent credit score credit cards generally offer lower interest rates, thanks to your strong credit history. When lenders trust you to pay back your debt promptly and responsibly, they have less of an incentive to charge high interest rates — which means you can expect to receive lower interest rates not only on your credit cards, but also on auto loans, personal loans and mortgages.
Plus, your excellent credit will never stand in the way of your ability to rent an apartment, open utility accounts or — if your employer checks credit before hiring — get a job.