Do I Need A Credit Score?

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bigtex
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Do I Need A Credit Score?

Post by bigtex » Sun Nov 11, 2018 10:12 am

Hello,

I am 28 and married. I have never had a credit score or had any credit cards student loans etc. My spouse has an excellent score at 800. We use spouses credit history to get our home. Other than that, we have a credit card in spouses name that we use sometimes and pay off in full. At this point in the game, should I get a credit card and start building a score? My understanding is that my auto insurance could be higher, among other things without having a score. Also, spouse is staying home next year so we couldn’t use her income for a loan, heloc, etc. I am debt averse and save adequately, so I don’t really plan on needing loans for anything. If I should get a score, will one credit card be enough to build a decent score in a year or two? Are there any 3% cash back cards with no annual fee? I know lots of questions just trying to see what y’all think. Thanks.

Rupert
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Re: Do I Need A Credit Score?

Post by Rupert » Sun Nov 11, 2018 10:20 am

Yes, you should get a credit card and start building credit. Lots of things could happen that would prevent you from relying on your spouse's credit going forward. If you're disciplined enough to pay the balance in full every month (and you probably are if you're posting here) and not buy things you don't need, then credit cards actually save you money via cashback programs, etc. Presently, you're leaving money on the table.

UpperNwGuy
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Re: Do I Need A Credit Score?

Post by UpperNwGuy » Sun Nov 11, 2018 10:29 am

You don't have to go into debt to get a credit score. Get a credit card, use it, pay the statement balance in full within three weeks after the statement is cut, and you will find yourself with a decent credit score... and no debt.

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Watty
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Re: Do I Need A Credit Score?

Post by Watty » Sun Nov 11, 2018 10:37 am

Yes you should figure out how to build up a basic credit history, but I am not sure about the details of the best way to do that. You may be able to get a credit card with your spouse and have the credit history reported in both of your names.

Many people, often women, have found that after the death of a spouse or an unexpected divorce that not having a good credit score not only makes it difficult to do things like to get a credit card but it also makes it difficult to even rent an apartment. In my family I know more about finances than my wife so over the years I have made sure that my wife has a good credit history just in case something happens to me.

At the age of 28 it should not be that difficult to establish credit. One problem is that you will run into if you wait until you are older to establish your credit history is that potential lenders will be more concerned about identity theft and that you may not be who you say your are.

Nissanzx1
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Re: Do I Need A Credit Score?

Post by Nissanzx1 » Sun Nov 11, 2018 10:52 am

I wouldn't worry about it personally. I could care less if mine was zero, 500, 800, etc. I'm not borrowing. I'd rather have actual money ;)

furwut
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Re: Do I Need A Credit Score?

Post by furwut » Sun Nov 11, 2018 11:39 am

I too don’t worry about my credit score, but then, I’m retired with no foreseeable intention of incurring anymore debt. However, someone just starting out should be building a good credit history. Not only will this be used to set rates on loans and the purchase of some products (e.g., auto insurance) but it is can used by landlords on rental applications and by employers on job applications.

In addition to paying credit card balances off each month one can also take advantage of financing deals that offer zero or very low interest rates on purchases. In the long run it many be worth it to pay a small bit of interest to gain the positive credit history.
Are there any credit cards that offer 3% back?
2% back is the maximum I know about for all purchases. But there are cards that offer more back on certain purchase categories. For example, I have a no fee American Express card that gives me 3% back on groceries.

RickBoglehead
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Re: Do I Need A Credit Score?

Post by RickBoglehead » Sun Nov 11, 2018 11:40 am

You have a credit score. Everyone does, unless you have never banked.

At 28 you are long overdue to build credit.

2% cash back Citi DoubleCash.

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8foot7
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Re: Do I Need A Credit Score?

Post by 8foot7 » Sun Nov 11, 2018 11:44 am

I would say if you’re in a home already and you’ve otherwise made it to 28 with no score, you probably don’t need one. It can make life more convenient but you’ve clearly figured out how to be an adult without a credit history, something many people believe is impossible. Do what you want.

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8foot7
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Re: Do I Need A Credit Score?

Post by 8foot7 » Sun Nov 11, 2018 11:48 am

RickBoglehead wrote:
Sun Nov 11, 2018 11:40 am
You have a credit score. Everyone does, unless you have never banked.

At 28 you are long overdue to build credit.

2% cash back Citi DoubleCash.
There are 45 million americans without a credit score.

In order to receive a valid FICO® Score, the credit report must have:

At least one account opened for six months or more, and
At least one account that has been reported to the credit bureau within the past six months, and
No indication of deceased on the credit report (Please note, if you share an account with another person this may affect you if the other account holder is reported deceased).
The minimum scoring criteria may be satisfied by a single account or by multiple accounts on a credit file. In certain rare cases, whether a given credit report qualifies for a FICO® Score may vary across different FICO® Score versions.

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samsoes
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Re: Do I Need A Credit Score?

Post by samsoes » Sun Nov 11, 2018 11:59 am

Credit scores weigh heavily when determining car insurance rates.

One would think that a creditworthiness rating would be a reflection on a person’s ability to manage and service personal debt, not the ability to safely brake on an icy road surface; but, it is what it is.
"Happiness Is Not My Companion" - Gen. Gouverneur K. Warren. | (Avatar is the statue of Gen. Warren atop Little Round Top @ Gettysburg National Military Park.)

Austintatious
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Re: Do I Need A Credit Score?

Post by Austintatious » Sun Nov 11, 2018 12:08 pm

Never assume that you'll always be able to rely on the credit history and credit cards of your spouse. You should work affirmatively to build your own credit history and that's exactly how you should look at it - building it, step by step. Pay down your debt - credit cards, loans, mortgage - on time and you'll have that solid credit history. Notice that I said "your" debt. Having a good credit record can make your life meaningfully better than life without a good history and score.

Your ability to land a good cash back credit card may depend on your credit score. Even if you're first unable to acquire such a card, you'd do well to get the best card possible in your name and use it on a regular basis to pay your bills and purchase items that you would have purchased, had you not had a credit card.The key is to not carry a balance beyond a billing cycle so that, as has already been advised, you're paying the balance in full each month and avoiding the interest trap that comes with the card.

bigtex
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Re: Do I Need A Credit Score?

Post by bigtex » Sun Nov 11, 2018 12:25 pm

Thanks everyone for the replies. It helps.

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fortfun
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Re: Do I Need A Credit Score?

Post by fortfun » Sun Nov 11, 2018 12:38 pm

Might as well take advantage of free money if you have a good score. Many on this board make 5 to 10k/yr on CC sign up bonuses with very little effort (myself included).

RickBoglehead
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Re: Do I Need A Credit Score?

Post by RickBoglehead » Sun Nov 11, 2018 1:01 pm

8foot7 wrote:
Sun Nov 11, 2018 11:48 am
RickBoglehead wrote:
Sun Nov 11, 2018 11:40 am
You have a credit score. Everyone does, unless you have never banked.

At 28 you are long overdue to build credit.

2% cash back Citi DoubleCash.
There are 45 million americans without a credit score.

In order to receive a valid FICO® Score, the credit report must have:

At least one account opened for six months or more, and
At least one account that has been reported to the credit bureau within the past six months, and
No indication of deceased on the credit report (Please note, if you share an account with another person this may affect you if the other account holder is reported deceased).
The minimum scoring criteria may be satisfied by a single account or by multiple accounts on a credit file. In certain rare cases, whether a given credit report qualifies for a FICO® Score may vary across different FICO® Score versions.
I'll rephrase.

I'll be the OP has a credit score. I'll bet he hasn't checked with any of the credit bureaus to see that he doesn't.

Jags4186
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Re: Do I Need A Credit Score?

Post by Jags4186 » Sun Nov 11, 2018 1:05 pm

Are there any credit cards that offer 3% back?
Discover IT Miles offers 3% cashback for the first year of card membership, 1.5% afterwards. You can swap opening and closing this card with your spouse every other year as long as this promotion lasts.

Alliant Visa Signature offers 3% cashback for the first year, 2.5% going forward, and a $59 annual fee waived first year. Again you could do the same as the Discover IT Miles card and alternate opening and closing however this card is more difficult to get.

The Bank of America Travel Rewards card offers 2.62% cashback with no annual fee provided you have at least $100,000 in combined checking/investments at Bank of America.

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dm200
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Re: Do I Need A Credit Score?

Post by dm200 » Sun Nov 11, 2018 1:11 pm

RickBoglehead wrote:
Sun Nov 11, 2018 11:40 am
You have a credit score. Everyone does, unless you have never banked.
At 28 you are long overdue to build credit.
2% cash back Citi DoubleCash.
Merely banking does not always generate a credit score. I have seen a few folks without one.

Yes - I would open a few accounts to build a score.

bigtex
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Re: Do I Need A Credit Score?

Post by bigtex » Sun Nov 11, 2018 1:15 pm

RickBoglehead wrote:
Sun Nov 11, 2018 1:01 pm
8foot7 wrote:
Sun Nov 11, 2018 11:48 am
RickBoglehead wrote:
Sun Nov 11, 2018 11:40 am
You have a credit score. Everyone does, unless you have never banked.

At 28 you are long overdue to build credit.

2% cash back Citi DoubleCash.
There are 45 million americans without a credit score.

In order to receive a valid FICO® Score, the credit report must have:

At least one account opened for six months or more, and
At least one account that has been reported to the credit bureau within the past six months, and
No indication of deceased on the credit report (Please note, if you share an account with another person this may affect you if the other account holder is reported deceased).
The minimum scoring criteria may be satisfied by a single account or by multiple accounts on a credit file. In certain rare cases, whether a given credit report qualifies for a FICO® Score may vary across different FICO® Score versions.
I'll rephrase.

I'll be the OP has a credit score. I'll bet he hasn't checked with any of the credit bureaus to see that he doesn't.
Yes I have checked with the bureaus and tried sites like credit karm which give me an error. Also, can’t set up my social security account online cause I don’t have a score. They have no security questions to ask me to verify identity.

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dm200
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Re: Do I Need A Credit Score?

Post by dm200 » Sun Nov 11, 2018 1:17 pm

My spouse has an excellent score at 800. We use spouses credit history to get our home. Other than that, we have a credit card in spouses name that we use sometimes and pay off in full. At this point in the game, should I get a credit card and start building a score?
If you are listed as a borrower on the mortgage, that will help greatly in building a credit score.

bigtex
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Re: Do I Need A Credit Score?

Post by bigtex » Sun Nov 11, 2018 3:00 pm

dm200 wrote:
Sun Nov 11, 2018 1:17 pm
My spouse has an excellent score at 800. We use spouses credit history to get our home. Other than that, we have a credit card in spouses name that we use sometimes and pay off in full. At this point in the game, should I get a credit card and start building a score?
If you are listed as a borrower on the mortgage, that will help greatly in building a credit score.
I am not, but I was thinking I could be added to my spouses already open credit card to boost / create a score.

Nate79
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Re: Do I Need A Credit Score?

Post by Nate79 » Sun Nov 11, 2018 3:05 pm

bigtex wrote:
Sun Nov 11, 2018 3:00 pm
dm200 wrote:
Sun Nov 11, 2018 1:17 pm
My spouse has an excellent score at 800. We use spouses credit history to get our home. Other than that, we have a credit card in spouses name that we use sometimes and pay off in full. At this point in the game, should I get a credit card and start building a score?
If you are listed as a borrower on the mortgage, that will help greatly in building a credit score.
I am not, but I was thinking I could be added to my spouses already open credit card to boost / create a score.
Getting added as authorized user on all of her cards is an easy way to quickly build credit.

Mike Scott
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Re: Do I Need A Credit Score?

Post by Mike Scott » Sun Nov 11, 2018 3:28 pm

You don't seem like the type to want to juggle credit card bonuses etc so don't worry about it. It's just money. :) You can start as an authorized user on spouses card. Then after a year or so apply for your own no fee 2% cash back card and run everything possible through it. Build your credit score and save 2% on everything you purchase. If you have a Fidelity account you could use their card. Cit Double cCsh is another. Citi is also the best one remaining for price protection etc. The fees on the higher cash back cards can erode their value unless you run more expenses through the card. The BOA or Alliant cards are two of the better single cards for higher annual spend. Of course, there are many ways to push cash and travel rewards to 5-10+% on pretty much everything you buy but you have to play the credit card bonus game. I figure it's worth about 5K per year in cash and points for us so the bonus game is definitely worthwhile in my opinion.

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dm200
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Re: Do I Need A Credit Score?

Post by dm200 » Sun Nov 11, 2018 4:21 pm

If/when a credit score is needed, it can take time to build a good one.

Take the steps now to build a good score - and you will be safe in the future.

bigtex
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Re: Do I Need A Credit Score?

Post by bigtex » Sun Nov 11, 2018 4:28 pm

dm200 wrote:
Sun Nov 11, 2018 4:21 pm
If/when a credit score is needed, it can take time to build a good one.

Take the steps now to build a good score - and you will be safe in the future.
Would there be any cases where I’m better off without having a score? Like for not being as susceptible to identity theft or something like that?

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dm200
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Re: Do I Need A Credit Score?

Post by dm200 » Sun Nov 11, 2018 4:29 pm

bigtex wrote:
Sun Nov 11, 2018 4:28 pm
dm200 wrote:
Sun Nov 11, 2018 4:21 pm
If/when a credit score is needed, it can take time to build a good one.

Take the steps now to build a good score - and you will be safe in the future.
Would there be any cases where I’m better off without having a score? Like for not being as susceptible to identity theft or something like that?
I cannot think of any.

bigtex
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Re: Do I Need A Credit Score?

Post by bigtex » Sun Nov 11, 2018 7:04 pm

I think I am going to go with the Bank of America cash rewards card because of the $250 bonus for only spending $500 and no annual fee even though I don’t use Bank of America accounts.

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