The current average credit score for a 21-year-old is 680, according to data from Experian®. That’s 37 points lower than the national average among all consumers of 717, but it is categorized as a good score.
As a 21-year-old, you’re likely to be fairly new to the world of credit and not have a lengthy history of managing loans and credit cards. You have plenty of time to build your score further, which can be done with some smart but simple financial strategies.
Key Points
• The average credit score for a 21-year-old is 680, considered in the good range but below the national average of 717 for all ages.
• Credit scores tend to increase with age; older generations typically have higher scores.
• Building credit involves timely bill payments, low credit utilization, and a long credit history.
• Building one’s credit score at age 21 could involve getting a secured credit card or credit-builder loan or being added as an authorized user on a credit card.
• Age affects credit score indirectly through credit history length, which accounts for 15% of a person’s FICO score.
Average Credit Score for a 21-Year-Old
Experian analyzed credit scores among the different generations and found that Gen Zers between the ages of 18 and 26 have an average score of 680. A score of 680 is considered good. Here’s how FICO® scores, which range from 300 to 850, are categorized:
| Poor | 300-579 |
| Fair | 580-669 |
| Good | 670-739 |
| Very good | 740-799 |
| Exceptional | 800-850 |
What Is a Credit Score?
A credit score is a numerical representation of the information on your credit report. Each consumer has several different scores, but lenders most commonly look at FICO scores.
Lenders consider your credit score to assess your risk as a borrower. A low score suggests that you may be new to credit or have a history of missing payments on your loans or lines of credit. A high score, on the other hand, suggests that you can manage credit well and pay your bills on time.
It’s easier to get approved for loans and credit cards with a high credit score. Plus, a strong credit score can open the door to more favorable interest rates and terms. These benefits can save you thousands over the life of a loan.
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What Is the Average Credit Score?
The average credit score for all ages in America is 717 as of October 2023, according to FICO. In the previous year, the average score was one point higher at 718. Both scores fall into the “good” credit score range.
As for the average credit score according to VantageScore® vs. FICO, that would be 702.
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Average Credit Score by Age
Here’s how the average FICO credit score breaks down by age group, according to Experian, one of the three major credit bureaus.
| Age group | Average credit score |
|---|---|
| Gen Z (18 to 26) | 680 |
| Millenials (27 to 42) | 690 |
| Gen X (43 to 58) | 709 |
| Baby boomers (59 to 77) | 745 |
| Silent generation (78+) | 760 |
As you see, credit scores tend to rise with age. The age group with the lowest average credit score is the youngest, and the one with the highest number is the oldest.
Also worth noting: Your starting credit score isn’t the lowest possible score of 300. Rather, after accessing credit and using it responsibly for several months, your score should start to be reported at a higher number than that, perhaps in the 500 to 700 range.
What’s a Good Credit Score for Your Age?
A good credit score for your age is somewhat subjective. However, you may consider a good score to be one that’s above the average for your age group. Since the average credit score for a 21-year-old is 680, you may consider a good score for that age to be anything above 680.
Technically, any score of 670 or higher falls into the “good” category on FICO’s scoring range. There’s still room for improvement, though, and lenders often prefer a score in the 700s or higher. For example, if you have a very good or exceptional credit score, you may qualify for credit cards that offer more robust rewards, whether that means more points or miles or other perks.
How Are Credit Scores Used?
Lenders review your credit score when you apply for a loan or credit card. A high credit score suggests that you’re a low-risk candidate for credit and are likely to pay your bills on time. A low credit score can be a red flag to lenders, as it indicates you may have missed debt payments in the past or be new to the world of credit.
Along with impacting your chances of loan approval, your credit score also influences the rates, terms, and loan amounts you can qualify for. Borrowers with higher scores tend to get the most competitive rates, low (or no) fees, and access to higher loan amounts. Borrowers with low scores may get stuck with higher interest rates, more fees, and lower loan limits.
Factors Influencing the Average Credit Score
The national average credit score decreased by one point between April 2023 and October 2023. FICO attributes this decrease to a few factors, including more past-due payments, higher consumer debts, and an increase in default rates. (The five key factors impacting credit scores are payment history, amounts owed, length of credit history, credit mix, and new credit, which are explored below.)
In the future, the average score could continue to drop if high inflation and increased debt loads further strain Americans’ finances. However, changes to interest rates and an improved job market could help consumers manage their credit and boost average credit scores.
How to Build Your Credit Score
Building your credit score won’t happen overnight, but there are several steps you can take to positively impact your score over time. These include:
• Paying your bills on time: Make on-time payments to build your credit score and avoid loan delinquency or default.
• Reducing your credit utilization: Keep your credit utilization ratio, or the amount of credit you’re using compared to what’s available to you, to 30% or lower. Some financial experts say that knowing how to lower your credit utilization to 10% is a good financial skill to have.
• Keeping hard inquiries to a minimum: Applying for several types of new credit can ding your score as lenders run hard inquiries on your credit report. If you’re loan shopping, try to keep applications to a short window of time, so that they can qualify as just one inquiry. Whenever possible, prequalify for loan or credit card offers to avoid triggering a hard credit check.
• Disputing errors on your credit report: You can check your credit report without paying. When accessing your report, know that if you spot any mistakes, it’s important to submit a dispute to try to have them removed.
Recommended: Why Did My Credit Score Drop After a Dispute?
How Does My Age Affect My Credit Score?
Although your age doesn’t directly impact your credit score, it can affect the length of your credit history. The length of your credit history, or age of your accounts, influences 15% of your FICO score, as noted above.
As a 21-year-old, you’re probably pretty new to the world of loans and credit cards. It will take time to build up the length of your credit history. Along the way, avoid closing old accounts that are in good standing, such as credit cards, to preserve the length of your credit history.
What Factors Affect My Credit Score?
The following factors are what affects your credit score:
• Payment history (35%): On-time payments can build your score, while late payments will drag it down.
• Amounts owed (30%): Keep your credit utilization low (no more than 30% of your credit limit) to protect and positively impact your score.
• Length of credit history (15%): This refers to the age of your accounts. Someone with a decade of positive credit history will likely rank more highly in this category than someone who just opened their first credit card last year.
• Credit mix (10%): You can also build your score if you’ve successfully managed various types of credit, such as installment loans and credit cards.
• New credit (10%): Opening several new accounts at once can decrease your score and looks risky to lenders.
At What Age Does Credit Score Improve the Most?
Experian data shows that the average credit score of Baby Boomers (59 to 77) is 36 points higher than the average credit score among Gen Xers (43 to 58). It’s worth noting that this difference may reflect the different economic realities that each generation faced, rather than suggest that your score will improve significantly in your late 50s.
Nevertheless, it is likely that your credit history will lengthen over the years, and this factor could have a positive impact as your credit score updates over time.
How to Build Credit
Along with the advice described above, a few additional tips for how to build credit include:
• Get your rent and utility payments reported to the credit bureaus: If you’re new to building credit, consider using a service that reports your on-time rent and utility payments to the credit bureaus.
• Open a secured credit card: With a secured credit card, you put down a deposit upfront that acts as your credit limit. The credit card issuer will report your payments to the credit bureaus, so you could build your score by paying your bills on time.
• Become an authorized user on a credit card. This scenario often happens in families. A parent with good credit can add a child (age restrictions may apply) to their credit card account, which can then build the child’s credit score. If you are added as an authorized user, it’s important to use this access to credit responsibly.
• Take out a credit-builder loan: As the name suggests, credit-builder loans are designed to help people build credit. Your monthly payments usually go into a savings account, which you can access at the end of your loan term.
• Request a credit limit increase: You can reduce your credit utilization by paying down credit card balances, but another strategy is to increase your credit limit. Ask your credit card issuer for an increase or consider opening a new card. (Example: If you owe $5,000 on a card with a $10,000 credit limit, your utilization is 50%. If you have the limit raised $5,000 to $15,000, you owe the same amount, but your utilization drops to 30%.) Be careful not to rack up more credit card debt, though, or this strategy will backfire.
Credit Score Tips
If you’re 21-years-old, you have time to learn and adopt healthy financial habits and build your credit score.
• Focus on paying your bills on time to not only positively impact your score, but also avoid late fees and default. Use a money tracker app to stay within budget. Tip: See what tools your financial institution may offer.
• Opening a credit card account can be helpful in establishing your credit history, but be careful not to charge more than you can afford. Paying off your balance from month to month will help you keep your credit utilization low and avoid interest charges. Learn more about how long it takes to build credit so you can focus on this goal.
• Also keep an eye on spending so your credit utilization doesn’t climb over the 30% mark. A spending app could help you keep tabs on this important aspect of money management, whether provided by your bank or a third party.
The Takeaway
The average FICO credit score for a 21-year-old is currently 680, which falls in the range of a good credit score. Typically, older Americans have higher credit scores than younger ones. Good financial habits that can positively impact your credit score include always paying bills on time, keeping credit utilization below 30%, maintaining a long credit history and a varied credit mix, and not making too many applications for credit in a short time period. Using tracking tools to manage your money can also benefit you.
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FAQ
What’s a good credit score for a 21-year-old?
The average credit score for a 21-year-old is 680, which falls into the good range. So a good score at 21 may be 670 (the start of the good range for FICO scores, which ends with 739) or anything higher than that.
Is a 700 credit score at 21 good?
A 700 credit score at 21 is considered good. It’s higher than the average for that age group (680) and falls into the good range, which goes from 670 to 739, in the FICO scoring model.
Can a 20-year-old have a 750 credit score?
A 20-year-old may be able to have a 750 credit score, but it could be challenging at that age. You often need several years of positive credit history to build your score as high as 750.
What is a good credit limit at 21?
According to Experian, the average credit limit among Gen Zers (age 18 to 26) is $12,899. A good credit limit for you is based on several factors, though, including your income and your spending habits.
Is 21 too late to build credit?
21 is not too late to build credit — in fact, it’s a great age to start. With responsible credit card usage and on-time debt payments, you can build your score over the years ahead.
How can I build my credit fast at 21?
Some ways to build your credit fast at 21 include reducing your credit utilization ratio and making on-time payments on your debts. You might also open a secured credit card or take out a credit-builder loan to build your credit.
Photo credit: iStock/Jose carlos Cerdeno
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