What Is a Good Credit Score for a 24-Year-Old?

A credit score is a numerical representation of an individual’s creditworthiness, reflecting their likelihood of repaying borrowed money. Lenders, landlords, and some employers use these scores to assess financial responsibility. A higher score indicates lower risk to lenders, leading to more favorable terms on loans, credit cards, and rental agreements.

Understanding Credit Score Ranges

In the United States, FICO and VantageScore are the most widely used credit scoring models, both ranging from 300 to 850. FICO scores, used by 90% of top lenders, categorize scores as: “Good” (670-739), “Very Good” (740-799), “Exceptional” (800+), “Fair” (580-669), or “Poor” (300-579). VantageScore also uses a 300-850 range: “Good” (661-780), “Excellent” (781-850), “Fair” (601-660), and “Poor” or “Very Poor” (below 601). These ranges provide a general understanding of what each score category signifies. Both models predict the likelihood of an individual falling 90 days or more behind on a payment.

Defining a Good Credit Score for a 24-Year-Old

A “good” credit score for a 24-year-old is typically in the “Good” or “Fair” categories as defined by FICO or VantageScore. Age is not a direct factor in credit score calculation, but younger individuals often have shorter credit histories. The average FICO score for Gen Z (including most 24-year-olds) was 680 in Q3 2023, placing them in the “Good” range. The average VantageScore for this age group was 663 as of March 2024, at the lower end of the “Good” range.

A 24-year-old should aim for a score in the mid-600s to low-700s. A score of 670 or higher enables access to better interest rates on auto loans, personal loans, and credit cards. It also improves chances for apartment rentals without a co-signer or larger security deposit. While an “Excellent” score is a long-term goal, a “Good” score demonstrates responsible financial behavior and a growing credit profile.

Key Factors in Credit Score Calculation

Credit scores are derived from factors reported by creditors to Equifax, Experian, and TransUnion. These include:

Payment history (35% of FICO score): Evaluates on-time payments, late payments, collections, or bankruptcies. Consistent on-time payments are important for building a positive credit profile.
Amounts owed (30% of FICO score): Considers total debt relative to available credit. Keeping credit card balances low, ideally below 30% of the total credit limit, positively impacts this score portion.
Length of credit history (15%): Reflects how long accounts have been open and their average age. A longer history of responsible credit use is viewed favorably.
New credit (10%): Assesses recent inquiries and newly opened accounts. Opening multiple new accounts in a short period can indicate higher risk and may cause a temporary score dip.
Credit mix (10%): Considers the variety of credit accounts managed, such as credit cards, installment loans, and mortgages.

Strategies for Building and Maintaining Strong Credit

Building and maintaining strong credit involves consistent, responsible financial habits. To positively influence payment history, set up automatic payments for all bills and loans to ensure timely remittances, preventing late fees and negative marks. Making at least the minimum monthly payment on time is essential. For credit utilization, keep credit card balances low relative to credit limits. Paying off credit card balances in full each month, or significantly reducing them, is an effective strategy.

For individuals with limited credit history, secured credit cards are valuable. These cards require a cash deposit, which becomes the credit limit, and their payment activity is reported to the major credit bureaus, allowing for credit building.

Another option is to become an authorized user on an established credit account belonging to a trusted individual with excellent credit habits. The account’s positive payment history and low utilization can reflect on the authorized user’s credit report, potentially boosting their score. However, the primary account holder must maintain responsible habits, as their negative actions could also impact the authorized user’s score.

Student loans and auto loans, as installment credit, contribute to a diverse credit mix and length of credit history. Consistently making on-time payments on these loans demonstrates an ability to manage different forms of debt responsibly.

Regularly reviewing credit reports for accuracy and understanding how each action impacts the credit score helps improvement. Gradually adding different types of credit and managing them responsibly over time contributes to a robust credit profile.

Accessing and Reviewing Your Credit Information

Regularly accessing and reviewing your credit information is important for maintaining financial health and identifying potential issues. Federal law grants consumers the right to obtain a free copy of their credit report from each of the three major credit reporting agencies—Equifax, Experian, and TransUnion—once every 12 months. AnnualCreditReport.com is the website for obtaining these free reports. This portal allows individuals to request reports from all three agencies simultaneously or to stagger requests throughout the year for continuous monitoring.

When reviewing a credit report, scrutinize all listed accounts for accuracy. Look for unfamiliar accounts, incorrect personal information, or inaccurate payment statuses, as these could be signs of errors or identity theft.

While AnnualCreditReport.com provides free credit reports, it does not include credit scores; these are available for a fee directly from the credit bureaus or through financial institutions. Promptly disputing any inaccuracies found on a credit report helps ensure the score accurately reflects an individual’s creditworthiness.