Did you lose your drive once over certain score?

[Thomas_Thumb]

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@IsambardPrince wrote:

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@blossom_rebuilding wrote:

I remember being near obsessed with checking my scores constantly when I was in my initial rebuild, and I had a hard time getting my scores over 660. That all changed when I got my mortgage, and when my scores were consistently in the mid-700s with pretty good limits, which I was very happy with, I was brought down to earth by realizing that even with much better scores, I was not in the financial shape I wanted to be. I had more credit card debt than I liked, so I took the notion of "finances over FICO" to heart. By the time I got rid of most of my consumer debt in 2023 and solely had (and still have) my student loans and mortgage to contend with, all my FICO 8s had cracked 800, but the scores weren't what I celebrated. I celebrated having my financial house more in order than it had ever been. Life has happened since that stalled that progress a bit, but since then, I watch my scores for amusement and not much else. I care far more about where my balances stand than where my scores are.

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FICO scores don't change based on how well you're doing financially. If you won the lottery today and got a billion dollars, your FICO score wouldn't go up a single point.

It's a score that rates how much of what kind of debts you're in, and how reliable you've been about paying debts. It gives, as "negative reason codes", punishment for not taking on credit cards, car loans, and a mortgage, even if taking on those particular things would make no sense in your situation, and would hurt you.

It is not a "winning with money" score. I've had a 806 FICO score with $1,000 in the bank, and a 590 with $40,000 in the bank. It loved that when I only had $1,000, that I had a car loan that was killing me.

I finally realized that FICO is not a measure of financial health, it's a reward for utter stupidity. The car loan ended up being a significant part of my eventual bankruptcy, which brought the stupid FICO score down much lower than had I never had a car loan.

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Interesting. I always thought my high scores related to being considered low risk. Never thought perfect payment history for over 40 years was stupid.

850 Fico 8/9 scores are possible with only a single paid off closed loan on file and a few open revolving accounts. Sure, an open loan can help as a score booster. However it can be a trivial SSL paid down to 9% B/L. No need for heavy installment debt to get top scores.

There are plently of high net worth people with low credit scores. Some have the means but just refuse to pay on their obligations. You want to get paid for your work, sue me.  For them credit scores likely have no meaning.

[IsambardPrince]

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@Thomas_Thumb wrote:

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@IsambardPrince wrote:

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@blossom_rebuilding wrote:

I remember being near obsessed with checking my scores constantly when I was in my initial rebuild, and I had a hard time getting my scores over 660. That all changed when I got my mortgage, and when my scores were consistently in the mid-700s with pretty good limits, which I was very happy with, I was brought down to earth by realizing that even with much better scores, I was not in the financial shape I wanted to be. I had more credit card debt than I liked, so I took the notion of "finances over FICO" to heart. By the time I got rid of most of my consumer debt in 2023 and solely had (and still have) my student loans and mortgage to contend with, all my FICO 8s had cracked 800, but the scores weren't what I celebrated. I celebrated having my financial house more in order than it had ever been. Life has happened since that stalled that progress a bit, but since then, I watch my scores for amusement and not much else. I care far more about where my balances stand than where my scores are.

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FICO scores don't change based on how well you're doing financially. If you won the lottery today and got a billion dollars, your FICO score wouldn't go up a single point.

It's a score that rates how much of what kind of debts you're in, and how reliable you've been about paying debts. It gives, as "negative reason codes", punishment for not taking on credit cards, car loans, and a mortgage, even if taking on those particular things would make no sense in your situation, and would hurt you.

It is not a "winning with money" score. I've had a 806 FICO score with $1,000 in the bank, and a 590 with $40,000 in the bank. It loved that when I only had $1,000, that I had a car loan that was killing me.

I finally realized that FICO is not a measure of financial health, it's a reward for utter stupidity. The car loan ended up being a significant part of my eventual bankruptcy, which brought the stupid FICO score down much lower than had I never had a car loan.

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Interesting. I always thought my high scores related to being considered low risk. Never thought perfect payment history for over 40 years was stupid.

850 Fico 8/9 scores are possible with only a single paid off closed loan on file and a few open revolving accounts. Sure, an open loan can help as a score booster. However it can be a trivial SSL paid down to 9% B/L. No need for heavy installment debt to get top scores.

There are plently of high net worth people with low credit scores. Some have the means but just refuse to pay on their obligations. You want to get paid for your work, sue me.  For them credit scores likely have no meaning.

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People who are actually rich don't need a FICO score because they don't have to finance things. Coming to a bank and asking for a loan means you are buying something you cannot afford with money you think you'll have over the next however many years the loan is.

"I think that I will be able to buy this house over 30 years, and that I will never ever lose my job or get sick or have medical bills, or get a divorce, or get into a car accident and get sued, or...and if you just give me the money now, I promise to either lose the house in a major lawsuit along with all the money I managed to pay you, or pay it off for the cost of two houses and only get one house. Please and thank you!"

"Yes, I would love a 5 year auto loan, no wait, make that 7 years! I would love to take a $60,000 car even though I don't have $60,000, pay $90,000 for it, and end up with a car that's worth $17,000. "

Rich people don't go into debt over things like this. If they go into debt at all, it's with the plan to make more money, and yes sometimes that backfires, but it's usually not tied to their personal credit rating.

My landlord is fixing to be on the business end of a MAJOR lawsuit where the people that loaned him the money to buy this building are going to get the building back. They'll lose millions on him, get a distressed asset, and he'll put an LLC into bankruptcy and may even flee the country for all I know. Right now all I can tell you is he turned the heat off in the hallways and doesn't seem to be too interested in anything except collecting as much rent as he can while he rides the nuke into the ground.

You can be a terrible businessman, not pay your bills, and put your LLCs into bankruptcy, and still have a terrific FICO score. They're not like us.

In fact, at this point the only reason I'm sure that my landlord won't ever be the President of America operating this way is, he wasn't born in the US.

It turns out that when Congress banned "bankruptcy abuse" in 2005, they weren't worried about people like my landlord, they just meant that YOU will not escape the credit card people, and if you do they'll tar and feather YOU for ten years.

For the average middle class person, avoiding debt traps is better than worrying about what their FICO scores are. The behaviors that lead to high FICO scores are destabilizing your actual financial security and may ultimately even lead to worse FICO scores.

Once most people get "addicted to credit" they start behaving like it was money that was actually theirs, until the problem becomes insurmountable. There's a reason the courtrooms across America are exploding with consumer debt lawsuits and bankruptcy. Almost all those defendants thought they had it under control at one point.

I don't like debt at any interest rate. The banks designed "0% APR" intro periods for a reason. So people will load it up and won't be able to pay before the interest starts. "What do you mean you're 'taking advantage' of an intro period? Did you adopt a pet?"

[Thomas_Thumb]

Sorry, not seeing how this diatribe has anything to do with the prior ascertain that those having a high credit scores is a reward for utter stupidity.

I agree that if someone has enough money and power credit score can be ignored. Assets are sheltered in the event of a bankruptcy. So what if credit score is low.

[Aim_High]

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@Thomas_Thumb wrote:

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@IsambardPrince wrote:

I finally realized that FICO is not a measure of financial health, it's a reward for utter stupidity.

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Interesting. I always thought my high scores related to being considered low risk. Never thought perfect payment history for over 40 years was stupid.   850 Fico 8/9 scores are possible with only a single paid off closed loan on file and a few open revolving accounts ...  No need for heavy installment debt to get top scores.

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+1.  Well said, @Thomas_Thumb.  FICO scores aren't supposed to be a measure of financial health but are merely a measure of credit risk.  Consequently, FICO and responsible consumer debt is not inherently evil.  Accepting the opportunity to borrow <responsibly> isn't stupidity, and many consumers are able to use it as one of the tools in their financial toolbox along the way to building the wealth that allows them to be credit-free.  

[Minimalist]

Do I think a FICO score is a measure of financial health?  Yes.

Do I think it's overrated as a measure of financial health? Also yes.

I don't believe that having as many cards as most people do around these boards is at all worth it.  For me it's quality over quantity, if the two cards I may wind up with turn out to be best for my spending, then that's a significant measure of what it's worth to me.  The one card I have now is a tool of rebuilding, while also trying to rebuild cash reserves and sinking/emergency funds (a higher priority all things considered!) FICO is a tool, not a status symbol, or a measure of bragging rights. Nor is it the be all, end all of personal finance. It's the participation trophy of the financial world. A measure of the ability to have instant gratification and maximized spending power, as opposed to being financially stable with the number of cards in your possession being a measure of how tall your house of 'cards' stands.  The bigger they are......and all that.  Some people can handle that many, that's on them.  I probably can, just choose not to.

As said previously you can have six figures in the bank, and have a lousy score.  Given the choice I'd rather have the former. I get way more piece of mind and sleep better at night from having the funds to get through life without debt, than having the ability to borrow more.

[Thomas_Thumb]

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@Minimalist wrote:

Do I think a FICO score is a measure of financial health?  Yes.

Do I think it's overrated as a measure of financial health? Also yes.

I don't believe that having as many cards as most people do around these boards is at all worth it.  For me it's quality over quantity, if the two cards I may wind up with turn out to be best for my spending, then that's a significant measure of what it's worth to me.  ... FICO is a tool, not a status symbol, or a measure of bragging rights. 

As said previously you can have six figures in the bank, and have a lousy score.  Given the choice I'd rather have the former. 

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Fico is a measure of risk of not paying credit obligations - not financial health or wealth. Since Fico was not designed to measure financial health directly, it should not be rated against that criteria.

Profiles with a lot of cards (say 20) often have lower scores than those with 3-5 cards. Why? New account openings represent increased risk for 12 months and seeking new credit is also a risk element.

Those with 10, 20 or 40 open cards are not getting them to boost Fico score. They are doing so for other reasons. Fico has a metric: too many accounts with balances. Fico does not reward profiles viewed as highly leveraged.

There is no need to sacrifice savings for a high Fico score. They aren't opposing attributes.

Certainly I would take $1000k in hard assets over 40 cards with a $1000k aggregate CL. However, some have both with no revolving CC debt. Not seeing how responsible credit management resulting in high Fico scores means you can't accumulate wealth. 

In any event, this discussion has strayed off topic. I just had to address the slander that stated those with high Fico scores are being rewarded for their stupidity. Poor credit and financial management does not lead to high scores.

[Realist]

No not at all.  I'm actually more interested than ever, and not driven by a FICO score, but rather opportunity.  

I think those that actually love messing around with finance, credit cards, moving money around, are going to maintain that drive no matter what score, and no matter how many cards they hold.  Others may absolutely hate it, or don't much care for it, but it serves as a means to an end, to help influence the best real life outcome pertaining to loans, borrowing, and shuffling money around.  If you really do enjoy something, it's never a day of work, and for some it's simply playing with numbers on a screen.  Scores are just markers, measurements in a race if you will, among yourself.  It should never be a race against anyone else.  The higher that number, the more the opportunity for yourself.

As you can see around the forum, there are some individuals with incredible credit line totals along with incredible scores, so I would speculate they too, enjoy the financial aspect of playing around with numbers.  Not only might they appear to be driven no matter the score, they do it responsibly, and have some fun with it.  Additionally, no two people share the same exact story in how they've arrived there.   To some people it's a game of fun, or a game of wits, or a game of leveraging opportunity.  For others, they may not share the same interest, and that's still ok.  My P2 doesn't care much for any of this, but I love crunching numbers, visualizing opportunity, and capitalizing on it.  Their FICO score is very high, but their drive is pretty flat lined.  My FICO score is very high, along with a drive through the roof.   That difference is still ok.  On the opposite side of this, where we started from, was low.  Very, very low.  What I am speaking of now, pushing opportunity, is what can occur if you put your financial house in order over time.  The icing on the cake comes by laying a solid foundation over time.

Eventually, at some point in life you may acquire most of the basic necessities you need in life.  You will have earned enough of a credit line that you couldn't possibly use much of it - ever.  You may even have acquired enough of strong FICO score, that you really don't have a purpose for it going forward, but, you will still want to protect it even if you don't need it.  Why?  Because some people think it's fun.  It's a game.  An opportunity.  A game of wits, and an ace in the pocket should you need to call on it.   The score doesn't matter, sometimes it's about the game.

As with anything in life, I always preach about silver linings.  They're always one no matter the scenario, and I've utilized many of them even in the worst conditions.  Like I mentioned that no two people share the same exact story in how they've arrived, as I can see some high FICO profiles here suggest plays that I am completely opposite in my approach, yet offer comparable metrics.  It's wonderful to see how everyones path influences their results.  I'm more of an abuse that score for maximum opportunity person, responsibility.  The further along in obtaining everything you need in life, the harder the push.  This may mean acquiring many CC's, which in turn also lowers overall account age, this is true.  The silver lining in this is, if you have that many open CC accounts, eventually they do grow up and age, solidifying and offering a very strong foundation towards a financial profile later - in addition to the typical loans you may acquire over a rolling ten year profile.  Additionally, if you were offered that many respectable CC lines, you likely already had a solid credit profile to draw upon.  My play is always for accumulation of a wide foundation in a credit profile (reasonably and responsibly), so when you accumulate a half dozen credit cards like I had recently, and then were denied for a few not due to FICO score - but rather hard inquiry limits, the FICO score reflected an increase, only to drop a few points overall.   Still weighted well in the higher end of 800+ profile.  At the end of the day, all of this addition barely moved the needle on the score.   So, I will take a break for a reasonable amount of time, and then push on yet again.  All those new accounts, along with many others, will have aged one to two more years in the meantime.

For some, it's a game, and the score is just a visual marker of personal progress and opportunity.    I personally like the SUBs.  That today, is the icing on the cake.  The score doesn't matter much these days, and I hope everyone here someday, also has that same opportunity to not really care about it.

[Minimalist]

There's also something to be said for contentment.  I don't live in the upper middle class income brackets that would get me to the levels that some people have with credit lines, I seriously question whether a lot of folks around here do either, and they're not just playing a 'game' with their finances that they'll eventually find out they can't win. 

If I'm trying to gain points with money, I'd much rather do it with HYSA, stocks and other type investments.  Just like credit cards, there are certain types of risk involved, but a higher level of reward if you know how to do it right. Something I'm in the process of learning even in my upper 40s. I come from a long line of relatives on both sides of the family that are horrible with money, so I'm learning on my own as I go.

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@Realist wrote:

Eventually, at some point in life you may acquire most of the basic necessities you need in life.  You will have earned enough of a credit line that you couldn't possibly use much of it - ever.  You may even have acquired enough of strong FICO score, that you really don't have a purpose for it going forward, but, you will still want to protect it even if you don't need it.  Why?  Because some people think it's fun.  It's a game.  An opportunity.  A game of wits, and an ace in the pocket should you need to call on it.   The score doesn't matter, sometimes it's about the game.

Which could be just as obtainable with 2-3 credit cards (even NO credit cards if you know how to manage your money).  I don't happen to think it's 'fun', I have better, much more sustainable ways of entertaining myself that's not going to flatline my credit should the SHTF.

For some, it's a game, and the score is just a visual marker of personal progress and opportunity.    I personally like the SUBs.  That today, is the icing on the cake.  The score doesn't matter much these days, and I hope everyone here someday, also has that same opportunity to not really care about it.

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The score would/should ultimately be a residual effect of your financial picture overall.  If you're good with cash reserves/investments, and secure in the knowledge that you'll be able to sleep at night not worrying about money, then that's the ultimate goal.  If that includes a high FICO score then wonderful, beyond 1-2 credit cards I don't believe in financing anything more than a car or a house (and even the car is questionable if you can budget to pay cash) so that's not going to have a dramatic effect on my life beyond better insurance rates and the ability to get certain employment (which I have my own opinions on, but I'll save for another thread).

[Realist]

I find contentment to be the ultimate goal in life.

If you are living with anticipation, you are living in the future.

If you are living with regret, then you are living in the past.

But, if you have achieved contentment, you are living in the now.

There is nothing more peaceful than to have found a content life.  Highly recommended.

(This doesn't mean you can't have healthy hobbies  👍) 

[GZG]

it's not the score, it's the cards

the whole point of the score is for the cards, so might as well spend that currency (good credit score) getting cards you want and make you money