You will probably never have a perfect 850 credit score.
Neither will I.
In fact, I don’t know anyone who has a perfect score.
Except one person who claims to have had a perfect score at least once.
He wrote on the MoneyTalksNews site here.
We can come close.
A perfect credit score will be the result of a long history of good financial habits.
I’ll probably never have that perfect score because I didn’t always have those good habits.
Although now that I’ve learned what to do – and what not to do – I have a score considered to be in the excellent range, around 810 to 820.
I say it’s a range because a credit score is never fixed at one number. Credit scores are like a snapshot of a moment in time. As data constantly comes in, the credit bureau recalculates the score.
Even the author of this article had only a fleeting experience with the perfect 850 score.
(Check here for tips to raise your credit score.)
More importantly, though, are the habits that got him there, very similar to the same habits I teach – the habits that I learned the hard way.
Such as . . .
Never borrow to buy things that go down in value.
Think about what people buy and put on credit cards, for example . . .
A restaurant meal. It goes down in value. In fact, it has no value at all once you’ve consumed it.
Movie tickets. Once the movie is over, no value.
Groceries. Again, same principle. Consumed and gone.
Books. DVDs. You only need to see the truth in this by visiting a garage sale or second hand store. Purchased at full price, on sale for a fraction.
Or think about a car loan . . .
How many cars do you know that go up in value?
Maybe a collector antique – but that’s not what we’re talking about.
Buying a car with a car loan – especially a new car – is totally the way to financial failure.
New cars lose half their value in the first two years. Why would you borrow money to let that happen to you?
Car loans can often be $300 to $500 per month.
The only purchase we should even consider borrowing money for is a house.
Even then, it’s best to avoid a mortgage if we can.
The reality is, most people need to borrow money to buy a house.
But then their mistake is that they do not make and follow a plan to pay it off quickly.
That mortgage could be paid off in as little as 5 to 10 years if they know what they are doing and follow the plan.
Simple common sense habits like this are what lead to a great credit score.
Maybe we’ll never have a perfect credit score – it can be great.
And you can be on your way to true financial freedom.