What Credit Score Do You Start With?

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The truth is that your starting credit score is zero. This is because your credit score is calculated based on your credit reports, and you won’t magically have any of this information established by the second you turn 18. It takes six months of account activity, such as student loan or credit card repayment, for your credit to build up and be factored into your credit score.

The lowest credit score calculated by most credit bureaus is 300. However, if you’re diligent about payments within your first six months, your credit score will likely be much higher than the absolute minimum. After the first six months of credit building, most people will have a credit score of around 500.

How is Your Starting Credit Score Calculated?

Credit scores are calculated using information from your credit reports. This information is summarized into a three-digit score that lenders can use to determine your financial trustworthiness. When talking about credit scores and credit utilization, you’ll be referring specifically to your FICO score the vast majority of the time.

FICO scores are compiled from five main data points:

  1. New Credit – 10%: Opening new lines of credit is inherently risky, and therefore a warning sign to lenders. 10% of your credit score is calculated based on the amount of new credit you have, such as starting several new credit cards within a short period of time. This also affects your credit utilization, or the ratio of available credit to the outstanding credit you owe.
  • Credit Mix – 10%: Another 10% of your credit score is calculated based on your credit mix. This incorporates the different types of credit accounts you have in your records, such as credit cards, mortgages, student loans, installment loans and more. Typically, this isn’t a key part of determining your credit score but is used as a way to paint a picture of your overall credit history.
  • Length of History – 15%: A larger chunk of your credit score is calculated based on the length of your credit history. This looks at the age of all your credit accounts and how long they’ve been active. In general, people with a longer credit history will have a higher score.
  • Amounts Owed – 30%: The importance of this factor should be fairly obvious. Lenders don’t want to work with people who they deem to be high-risk, and therefore won’t be able to pay back their loans. If you have a lot of credit debt and have a high credit utilization, it typically indicates that you’re at a greater risk of loan default.
  • Payment History – 35%: The most important factor in your credit score is your payment history. Do you have a history of paying loans on time and in full every month? Or will lenders have to chase you down? This is a clear indication of whether you’ll be a good loan candidate or not.
how your starting score is calculated

What Does Your Credit Score Start At?

As mentioned above, after the first six months most people will start at a credit score of around 500. This is calculated based on the FICO percentages and your corresponding performance within those six months. If you opened just one line of credit and have been paying it on time each month, you will likely have decent credit starting out.

It’s important to note that credit scores are calculated differently depending on each person’s unique financial situation. Even if you pay your bills on time every month, you may have a lower starting credit score than a peer who, say, has less student loan debt on their record than you do. You will also usually have a lower credit score to start out with than older borrowers since they’ve had more time to build positive credit.

How to Check Your Starter Credit Score

You can check your starter credit score and available credit by requesting a credit report online. In the U.S., there are three main credit bureaus that work to compile your credit reports: Experian®, TransUnion® and Equifax®. By law, you’re entitled to one free credit report per year from each of these bureaus. 

The government-approved site for requesting these credit reports is Log on to this website to request your reports, and be ready to provide identity verification.

Each bureau uses a slightly different scale when reporting credit scores:

When reading through your credit report, pay attention to more than just your score. Take a look at your credit history and payments, and take note of any areas where you could improve. 

What Your Starter Credit Score Can Tell You

Once you’ve pulled your free credit report and know what your score is, here’s what you can learn about your current financial information:

  1. You Actually Have a Credit Score: In general, this is a good thing. It means you’ve been financially active enough to actually have generated a credit score. This will be an asset in the long run, as we know that the length of credit history and your payment track record are important in calculating your credit score over time.
  • Your Credit Performance: Though establishing credit early on is usually a good thing, you’ll definitely be able to identify if and why you have a low starting credit score. Because your credit file will be so thin, any errors on your part will be obvious. 
  • A Check for Identity Theft: If you know that you haven’t been actively establishing credit over the past few months, yet you see on your report that you have a low credit score, you might have a case of identity theft on your hands. Make sure to double-check your report before jumping to any conclusions, though.
  • What Financial Benefits You Can Get: The main reason you’ll want to keep track of your credit score is that it affects the types of financial benefits you can qualify for, such as certain loans, credit cards and apartments. For example, most landlords won’t rent luxury apartments to tenants with anything below a 700 credit score.

What Does Your Starting Credit Score Qualify For?

Lenders look to your credit score to determine how financially risky you are. Here are some specific examples of what you could qualify for with your first year of available credit (using the FICO base scoring model):

  • Poor to Low (300 – 559): If you fall into the low credit score range, you won’t be able to qualify for much (unfortunately). Most lenders won’t offer a loan or credit card to people with this low of a score, and if they do the terms will not be in your favor, with high interest rates or other restrictions. If you’re looking to rent an apartment or apply for a loan, you’ll probably need a cosigner to ensure your payments.
  • Fair to Good (580 – 739): With a good credit score in this range, you shouldn’t have a problem qualifying for credit cards and loans, although you may have higher interest rates and limited credit balance.
  • Very Good to Excellent (740 – 800+): If you’re able to earn a starting credit score in this range (and good for you!), you’ll be able to shop around for the best financial products to fit your needs and won’t have problems qualifying for loans or leases.

Starter Credit Score and “Insufficient” Credit History

If a lender refuses your application based on insufficient credit history, it just means that your accounts aren’t old enough to satisfy their requirements. Most lenders want to see a detailed history of credit repayments and building credit, and a few months simply isn’t long enough to prove your reliability (unfortunately, this isn’t uncommon for people just starting out). 

The best way to improve your standing is to continue to be responsible with your finances and credit. If you don’t have a credit card, you could consider opening one new line of credit and paying it off every month to demonstrate your financial trustworthiness.

5 Ways to Improve Your Starting Credit Score

The good news is that improving your credit score and building credit is fairly simple, and you can see significant improvements in under a year. Here are a few ways you can take responsibility for your credit and improve your credit score:

  1. Build Up Your Savings: The best way to ensure full and regular payments is to build up a safety net. If you have an emergency one month, your savings can help you cover your regular monthly loans and credit card bills.
  • Always Pay Bills On Time: We know it’s obvious, but honestly, sometimes it’s easier said than done. Paying a day late every once in a while isn’t a big deal, but the other 99% of the time you need to pay off your bills in full and on time every month to show that you’re financially responsible. Set up a recurring alert on your phone or write notes in your planner to make sure you remember.
  • Use Credit Cards Minimally: Especially when you’re just starting out, you’re not going to want to make any large purchases on your high-interest credit cards. Instead, build credit steadily over time by making small purchases on your cards each month and paying them off in full.
  • Avoid Opening New Accounts: In order to avoid looking like a financial risk to lenders, avoid opening new accounts within your first year of credit history. One credit card that you pay off each month is perfectly fine, but owning multiple credit cards right off the bat can seem risky.
  • Monitor Your Credit Reports: Continue to check your credit score using a (safe) third-party service throughout the year to make sure your hard work is paying off, and be sure to request your official reports every year. This helps you to identify areas of improvement and make sure you’re not neglecting any credit accounts.
5 ways to improve your starting credit score

Starting your journey in the credit world can be complex, but you have people around to help you—like our team at Take a look at our credit education services to learn more about how you can increase your starting credit score, and visit our credit fix solutions for expert help.

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