What Is the Average Credit Score for a 25-Year-Old?

A credit score is a three-digit number that represents an individual’s creditworthiness, influencing financial opportunities. Lenders, landlords, and even some employers use it to make decisions about interest rates on loans, credit card approvals, and apartment rentals.

The Average Credit Score for 25-Year-Olds

The average FICO credit score for individuals aged 18 to 25 was approximately 680 in 2023. This score falls within the lower end of the “good” credit range.

A shorter credit history is a common factor contributing to this average. Younger adults may also carry student loans, which can positively impact their score with consistent, on-time payments, or negatively if payments are missed. Additionally, reliance on credit might temporarily affect scores for this age group due to higher utilization rates.

Understanding Credit Scores and Their Components

A credit score helps lenders assess the likelihood of an applicant repaying borrowed money. Two widely used scoring models are FICO and VantageScore, both typically ranging from 300 to 850. While both models evaluate similar data, they apply different weightings to various aspects of a credit report.

FICO Scores consider five primary categories: payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%). VantageScore models also emphasize payment history (40-41%) as the most influential factor. Other significant factors for VantageScore include the depth of credit, encompassing both age and types of accounts (20-21%), and credit utilization (20%).

Payment history details whether bills are paid on time. Amounts owed, or credit utilization, measures the percentage of available credit being used, with lower percentages being more favorable. The length of credit history reflects how long accounts have been open, including the age of the oldest account and the average age of all accounts. For 25-year-olds, who have a shorter financial history, this factor can naturally limit their score compared to older demographics. New credit examines recent applications and newly opened accounts, while credit mix considers the variety of credit types managed, such as credit cards and installment loans.

How to Check Your Credit Score

Accessing your credit score and credit report is a straightforward process that does not negatively impact your score. A credit score is a numerical summary, while a credit report provides a detailed record of your accounts and payment history. Regularly reviewing both can help you monitor your financial standing and identify inaccuracies.

You can obtain a free copy of your credit report annually from each of the three major nationwide credit reporting companies: Equifax, Experian, and TransUnion. The official website authorized by the federal government for this purpose is AnnualCreditReport.com. You have the option to request all three reports at once or space them out throughout the year to monitor your credit more frequently. Many credit card companies and banking apps also provide free credit scores as a service to their customers. When you check your own score, it is considered a “soft inquiry” and does not affect your credit standing.

Building and Maintaining a Strong Credit Score

Building a strong credit score involves consistent, responsible financial actions related to credit scoring models. Making all payments on time is the most influential action, as payment history accounts for a substantial portion of both FICO and VantageScore calculations. Setting up automated payments or reminders can help ensure bills are never missed.

Keeping credit utilization low is another impactful strategy. This ratio, representing the amount of credit used versus the total available credit, should ideally remain below 30% across all revolving accounts. Paying down balances and avoiding maxing out credit limits can significantly improve this ratio and, consequently, your score. A longer credit history benefits your score, as it demonstrates a sustained ability to manage debt responsibly. While time is a factor, maintaining older accounts in good standing and avoiding unnecessary closures can contribute positively.

Responsibly diversifying your credit types, such as having both revolving accounts (like credit cards) and installment loans (like student or auto loans), is beneficial. This demonstrates the ability to manage different forms of debt. Finally, being mindful of new credit applications is important; each application results in a “hard inquiry” that can temporarily reduce your score by a few points. Spacing out applications and only applying for necessary credit can help mitigate this impact.