T Nation

The Score


It was college and they were giving away free t-shirts. That was pretty much all it took to create a line around the corner as a few hundred students signed up for new credit cards that they knew they couldn't pay back if they maxed them out.

Let me get to the point...I am learning with every major financial decision that your credit score is WAAAY more important than anyone ever told me about growing up.

In fact, the majority of the people I know have poor credit to some degree mostly based on making poor financial decisions earlier in life.

I admit that I don't know everything about this topic myself. I only know that some of the things I have done lately would never have been accomplished if my credit score was fucked up....so maybe this will keep some of you knuckleheads from screwing yourselves over.

Hopefully others can contribute because free t-shirts may keep some of you from buying that house later on.

To start, this is what goes into creating a good credit score:

35% Payment history
30% Outstanding debt
15% Length of your credit history
10% Recent inquiries on your credit report
10% Types of credit in use

I personally think it is fucked up that "inquiries" into your credit score affect your credit score.


I fell victim to that. Discover found it appropriate to give me a $2000 spending limit as a college student.

Every weekend the plan would be that the beer went on the credit card and we would take what we collected and put it on the card. It's a plan that can't fail!!

I'll tell you what totally fucked my credit, though. Getting married/divorced. That shit followed me around for years. I was getting nailed for shit that wasn't even mine because they couldn't get a hold of him. Not fun. Don't get me wrong, I made my own mistakes, but having to pay for both sucks.


I have no credit.

I've never been in debt and have money invested, but never got a credit card and have been in Taiwan 10 years and they won't give one to foreigners here, from what I've heard, and don't know how to go about getting one while overseas like this. I know it's a good idea to have good credit by having a card and paying it off promptly but haven't done it yet.


Have to agree on the Divorce thing. My X was awarded her car and mine to me in our divorce decree. Each had payments. She skips on half of hers and some fucking car salesman talks her into letting it be repo'd so she can get a new car. That ended up on my credit report no matter that it was court ordered to her.

Good luck X on convincing the 20 year olds to delay gratification and NOT fall into this trap. Might as well try to convince them to stay celebate until marriage.


When I was in college I was amazed at the amount of people who had already destroyed their credit with ridiculous bills and owed thousands already.

I didn't have a credit card until I was like 24, mostly because I feared getting in debt so badly. But I'm a cheap fuckin mick, so there wasn't really too much to worry about even when I got it. I pretty much put my gas on it and that's all, and my credit is outstanding because I have a rule to NEVER put a bar tab on there.

Gas, presents for birthdays/christmas, the occasional book or boxing equipment... that's it. Otherwise it becomes much to easy to forget what you're spending and that it all adds up.


I know people right now who can't buy a decent car, can't get a house, can't get a motorcycle or anything else above small purchases because they fucked their credit up. Between that and taking majors that don't pay shit, I think it would be wise if people started paying attention to this.

There were times when it didn't even take a free t-shirt to sign people up. Free cheap ass frisbees seemed to work as well.

In fact, let's just say "free shit" brings out every dumb ass college student in a 20 mile radius.

Remember guys, girls cringe when they find out you still live at home with the rents.


As a person who fucked up their credit and then turned around and fixed it within 5 years, I've got some insight on this for those already behind the 8 ball.

I've always had a good, well paying job since graduating college in 2000 but I've always had a problem with discipline and just not giving a fuck outside of work. I liked to travel, I loved to get drunk at least 4 times a week, and was constantly getting in trouble for stupid shit with the law. The fines add up and so did the bills. I ran up my credit card bills got behind and my score dropped. They'd call and harass me for the money and I'd basically say "Fuck you, my score already sucks. What more can you do to me?" and hang up.

2004, I ignored letters from the courts. Fuck that, I ain't paying shit. Months after the letters, I go to the ATM and it says nothing is in my account. Shit. I go inside the bank and the teller tells me my account has been hit by the county. Their timing was perfect because it happened right after payday. I literally didn't have a penny to my name. I had to borrow a few hundred from my friend till my next paycheck. My credit score was like 480 or some shit.

That was the turning point. I called whoever I owed money and got put on a payment plan. If you do a payoff with the credit card , you can settle for as low as 35% of what you owe. So I settled like this where ever I could. I stopped drinking so much, stayed out of trouble and focused on my finances. About 5 years later, my credit score was 720, I didn't owe any credit card a penny, and in Nov 2009 I bout a $245,000 house on my own with a good interest rate. The only issue I had getting a mortgage was getting some paperwork from the county and DMV about liens that I paid off from my fuck up days.

I wrote a lot but my point is that you CAN fix your credit if it's already fucked up. I know when 1st hand when you're in the shit, it's tough to mentally get out of the shit. It may feel hopeless but the sooner you start the process, the sooner you'll remove the burden of debt and the have freedom that comes with being out of the shit.


I also find it funny that all through HS, all through college, hell, every formal education I've ever gotten, nobody mentioned "Credit score" and how important it was.

Thank God for my family, from who I learned how serious it was to take it seriously, because I saw both sides of it.


My parents have been teaching me how to manage money from a young age. I have had 2 credit cards since the age of 18 and never carried a debt on either of them. Meanwhile most of my friends carried at least thousand dollars on debt at some point, a lot of it for unnecessary crap.

It's also funny some of the decisions you see people without finance backgrounds make. I met this one physiotherapist who was carrying thousands of dollars of debt on her credit card. She thought I was an absolute genius when I advised her to get a line of credit from the bank and pay off the credit card debt since owing the bank will cause less interest to accumulate.


My credit rating is awesome. We get gold card offers all the time. I'll let my credit card debt climb up, then in one big payment pay it off. Never late, never default.


I've taken countless accounting classes, finance, economics, blah, blah, blah, and credit score never came up. Add on the shitty money management skills handed down by my parents and I'm lucky my score isn't worse than it is. It's actually not that bad. Definitely a stupid kid and always kept a high balance on credit cards, but always paid the minimum. So, although my credit isn't as screwed as it could be, I've paid thousands and thousands to credit card companies. They love people like me.

The importance of a good credit score should be subliminally put into every pop song out there, and have a feature on sesame street.


The message is out there now in the form of commercials. I don't know if it is covered in HS these days but it definitely should be. My older brother constantly told me ever since I was 16 how important credit score was and as an economics minor, I knew how to handle my finances. My problem was I just didn't give a fuck. Spending your 20's stoned and drunk will do that to ya. lol


No one ever told me shit about this until I needed it. Luckily, I was one of those who did think that getting random credit cards and not paying them off was retarded. I passed on my free shirts.

I just wish someone had sat down and explained this shit to me a long time ago.


At my school there was a basic finance course called Personal finance that only non-business majors are allowed to take. I would recommend everyone take this course or an introductory economics course if one at your school doesn't exist.


I max my credit card every month and pay it back every month. I also have a line of credit I've never touched, just in case I ever got into trouble. Like Raj said, I've also explained the logic of having a line of credit instead of a maxed credit card and been hailed a genius for it.

One thing that drives me nuts is people who have a large savings account AND alot of debt. Your savings gets you 1.5% and your debt costs you 23%! You aren't saving, you're letting interest and inflation eat you alive!

"Yea but I'm a bad saver, so I need to keep it."

People are just taught, "save your money," but don't realize what that entails.


Where does this line of thinking come from? When my girlfriend moved in, she had a bunch of money in the bank, but was still paying interest on a car loan that she could easily pay off. I got her to payoff the car loan which should've been a no brainer.

You should have a few grand in the bank for emergencies, but to pretend your saving when you're paying high interest makes no sense.


I think it's just the blind leading the blind. It is easier to say save your money Timmy, than to teach him about mutual funds, bonds, stocks, lines of credit, RRSPs, inflation etc etc. The only thing these people have been taught is leave some money in your savings account. So it's damn well going to stay there.


I've always had a natural aversion to debt that has prevented me from getting in trouble. Even during the dumbest period of my life I wasn't foolish enough to rack up credit card debt for a bunch of shit I didn't need.



Personal finance should definitely be a requirement in college, and probably high school as well. I took personal finance as an elective, and was lucky to have a professor who was OCD about finance.

He covered everything you need to understand to be a responsible adult. Try to imagine a 65 year old man telling about 35 college students that money is the #1 factor in atraction.

Things like credit, saving, and insurance are hard to learn on your own.



Yeah that seems fucked, I saw a thing on the news awhile back where a guy was car shopping. Every dealer he went to ran a inquiry and fucked his shit up even though they are not actually suppose to do that. So basically if you go to test drive shit to be on the safe side you have to make sure that they're not going to run a inquiry.