An 800+ credit score. We would all want to be that one guy in our social circle who is known for being in this elite club. But apart from bragging rights (which, let’s face it, is quite cool), an 800+ score has tangible financial and non-financial benefits.
Good thing? It is always within reach. If your score is well below 800 (see the Best Way to Check Credit Score), you too can join the ranks of America’s 800+ club.
What People with an 800 Credit Score Look Like
In a nutshell, here are the characteristics of a person with an 800 credit score:
- They have a perfect payment history for the past 24 months
- On average, they use 7% of their available credit
- Their average age account age is old
- They tend to carry multiple credit cards
22 percent of American adults have FICO scores of 800 or above according to the Ascent credit study. That is more than a fifth of the country’s adult population.
Implication? An 800+ credit score is far from the rarity many would imagine it to be. Clearly, many have done it before you. All you need is to apply the financial habits they used to get there. And that’s exactly what I’m going to show you here.
5 Tips to Help You to Get Your Credit Score to 800
While a fifth of America’s adult population is a large number of people, this statistic also means nearly 80 percent of adults have a sub-800 score. To get into the 800+ club, you need to do things somewhat differently from the 80 percent.
Virtually anyone irrespective of age (see How to build credit at 18) and income strata can maintain an 800+ score. Here’s how.
Payment History: Never Miss a Payment
Payment history is the single most important factor in your credit score. It accounts for more than a third of the FICO score’s calculation (see FICO vs Vantage). 800+ credit score holders typically have a perfect payment history for at least the past 24 months.
Do not take any payment or bill lightly. From medical co-pays to magazine subscriptions, all of them matter. If a tiny bill remains unpaid too long, the debt will be sent to a collection agency, and that is something the creditor will report to credit bureaus.
I must mention though that the payment of certain credit cards adds more value to your credit than others as this video explains. In a nutshell, a Visa/MasterCard credit card contributes the most to your credit score while a store card (like a Target or Home Depot credit card) contributes the least.
According to Merrill Chandler, the credit optimization guru in that video, there are different tiers of credit cards. Some credit cards provide more scoring value than others. This is how he breaks it down:
Payment Value by Credit Card Type
Type of Credit Card
Big Bank Visa or Mastercard
Amex or Discover
Store cards by finance companies
A “Visa” or “Mastercard” isn’t any card that has those logos on them. In this case, they refer only to credit cards issued directly by the big banks. The four big bank credit cards are those offered by Chase, Wells Fargo, Citi, and Bank of America.
When you make a payment on a visa or mastercard, you get the maximum credit scoring benefit from that. A payment from a Discover card gives you 20% less value, and store cards give even less.
If you have difficulty remembering when your debt is due each month, use autopay. In case you are not sure how much you will need in order to pay the bill in full, set it to pay the minimum.
Automatic bill payment is available for utility bills as well. Most utilities will allow you to configure autopay that automatically withdraws the amount due from your savings account, checking account, or credit card.
In case you do not want to use autopay, set up payment reminders. You could do it on your own using free tools such as Google Calendar or schedule online or email reminders within your online credit card company or bank account.
The sooner you commence paying your debt on time, the quicker your credit score will improve. Also, older credit penalties will matter less over time. Begin now and stay consistent. You do not have to be completely debt-free to have a high credit score. Nevertheless, commit to paying all your bills on time.
Amounts owed (or credit utilization) account for about 30 percent of your FICO score. The credit utilization ratio is how much credit you have used as a proportion of the total credit limit available to you.
For example, if you have a credit limit of $5,000 and have an outstanding balance of $1,000, your utilization ratio is 20 percent.
Do not max out your credit limit. The more extended you are, the harder it will be to push down your utilization ratio to healthy levels.
The CFPB recommends a credit utilization rate of below 30 percent. Still, while that may be sufficient for a good score (see Is 670 a Good Credit Score), you need to do more if you are aiming for the 800+ range. On average, 800+ credit score holders use about 7 percent of their available credit according to MyFICO.
Low utilization ratio points to strong personal financial management skills include leaving large headroom to cater to financial emergencies. High utilization ratio implies you will be at high risk of defaulting on your obligations if an unexpected financial setback comes along.
If you find that you have to use your credit card when your refrigerator, car, or other item breaks down, and then struggle to pay off your credit card bill in full each month, start an emergency fund.
The good news? Your credit utilization ratio is one thing you can change the fastest as long as your finances allow you to do so. Practice financial discipline by keeping your spending flat even as your income grows. If you carry credit balances from month to month, pay that off as soon as you can.
Time your monthly payment right. Credit card issuers will usually report credit information to a credit bureau toward the end of your billing cycle. Now, what if you pay for a $4,000 bathroom renovation on your $5,000 card limit just before they report your utilization?
You will be shown as having an 80 percent utilization ratio even though you always pay off the entire credit card balance each month. Plan your debt payments with the credit reporting date and not the payment due date.
If paying off the entire balance at one go proves strenuous, consider making smaller payments twice or thrice a month.
In case your credit utilization ratio is consistently above 30 percent but you have no problem paying your balances in full and on time, perhaps you should apply for a credit limit increase. This will push down your utilization ratio.
Length of Credit History
One of the golden rules of investing is that the past performance of a given asset is that there is no guarantee of similar returns in the future. But credit scoring models adopt a different view. They hold that past credit behavior to a pretty reliable barometer of future action.
If you opened your first credit account a year ago and have paid all your bills on time, that is impressive and certainly good for your credit score. However, credit scoring models do not treat a one-year account the same way they do a 10-year account even when both have a perfect payment record.
If you think about it, this is rational. The longer you have had a credit account, the more financial storms it has likely been subjected to. Someone who has successfully stayed on top of their payments for 10 years has certainly demonstrated a firm resolve to remain in tight control of their financial health.
Credit history accounts for 15 percent of your FICO score. A lengthy excellent record of paying off your credit cards and bills in a timely fashion is good. For an 800+ score, you have to build a long reputation of consistently paying bills promptly.
Ergo, if you have had a stellar credit record over the past 20 years, it strongly suggests a deep-seated, positive routine in place for managing your money. As this routine is now a well-established personal lifestyle, you are unlikely to deviate from it.
The older your accounts and the longer your credit history, the better. According to FICO.com, the average age of the oldest account for people with an 850 FICO score (perfect score) is 30 years old.
Fortunately, you don’t have to wait to have credit accounts that old to have an 800+ credit score. Aim to accumulate multiple credit accounts that have been open for at least 10 years.
Subsequently, closing old accounts will impair your credit score. A good rule of thumb for building credit until you have an exceptional credit history is to get three quality credit cards and keep them forever.
The more credit cards you have, the greater the risk that you may abandon and close your older accounts. Having fewer cards compels you to transact using the ones you have.
Credit accounts fall into two categories–installment accounts and revolving accounts.
Installment credit has an end date and requires you to make a fixed payment each month until you finally pay it off. The most common examples of installment debt are a mortgage, auto loan, student loan, and personal loan.
Revolving credit accounts do not have an end date. You use them as often as you like but need to pay off a certain minimum regularly. Credit cards are the best example of revolving credit.
You need a nice mix of credit accounts. Credit mix accounts for 10 percent of FICO credit score calculation. Ideally, you should have at least one installment loan and one revolving credit account.
A good credit mix will ideally include several credit cards, a mortgage, and one other type of installment loan (see How to build credit without a credit card).
Your credit mix demonstrates your ability to manage different types of credit. People with FICO Scores of 850 had on average 6.4 credit cards compared with the national average of 3.8 credit cards according to Experian.
That being said, do not take on debt you do not need in an attempt to diversify your credit. This will be self-defeating if you eventually have difficulty paying them off.
You can, however, be strategic. For example, if you have credit card debt, consider taking an installment loan to pay off part, or all of it. This will not only diversify your credit mix but also eliminate the higher interest rate you would have continued paying for the credit card debt.
The biggest shopping seasons of the year are characterized by department stores falling over themselves as they offer a sizable discount when you sign up for their credit card.
It is a clever marketing technique that appeals to that inner need to keep up with the Joneses’ or finally get a means of buying those items you have always wanted.
Applying for a new card whenever an offer is made to you can, however, be a major impediment to achieving an 800+ score. The hard credit inquiries that come with applying for a new credit card will hurt your score.
Any other lenders you approach from that point who run a credit check will assume there has recently been a negative event. Perhaps a job loss or large medical bill compels you to seek out multiple credit accounts to stay afloat.
New credit card accounts are responsible for 10 percent of your FICO score. Try not to open more than one new account per year. Rather, keep your accounts for years. Avoid too many new credit inquiries. Keep hard inquiries at just 2 per year.
When you do need a card but are not certain you qualify, submit a pre-qualification application. These result in soft inquiries and do not have any impact on your credit score.
Perks of Having an 800 Credit Score
An 800+ credit score offers you a raft of benefits.
Higher chances of approval: Your credit score is a mark of your creditworthiness. Lenders do not know you much in person. They rely on the objective data of a credit score to know whether you are likely to pay back a debt or not.
An 800+ score suggests you are a low-risk borrower and this raises your odds of credit account approval.
Preferential interest rates: An excellent credit score gives you access to better credit terms and interest rates from lenders. You will see this impact most conspicuously when applying for large loans such as mortgages and car loans.
The interest rate savings can add up to hundreds of thousands of dollars over your lifetime.
Better credit card offers: An 800+ credit score will give you access to credit cards that have a 0 percent promotional rate on purchases as well as balance transfers. You can also get rewards cards with lower interest rates and lower, or 0, fees.
Lower insurance premiums: Auto insurers will reward you for an exceptional credit score. Both your insurance history and your credit record will contribute to the computation of your insurance risk score. An 800+ credit score will see you pay lower premiums.
Background checks: A credit score may be a metric on personal finance, but its benefits spill over to realms beyond finance. A perfect credit score increases your attractiveness to potential employers and landlords.
Get a cell phone on contract: A high credit score will qualify you for a cell phone on contract. You will not have to pay a security deposit and may be eligible for discounted prices on the latest phones.
An excellent credit score allows you to avoid the pricey pay-as-you-go-plans those with low scores have to settle for.
Avoid utility security deposits: Deposits may be as high as $200 and can be a pain when relocating. With an 800+ score, you avoid paying the deposit.
How Long Does It Take to Get an 800 Credit Score?
How long it takes you to join the 800+ club will depend on where your credit score is at now . The further off the mark you currently are, the longer it will take. As a general principle though, you will need to demonstrate excellent credit habits for several years.
The effort is well worth it even if it takes you 10 years or more to get to 800+. Many lenders consider 760 the cutoff for a great credit score. Once you surpass that 760 threshold, you’ll already enjoy most of the same benefits as someone with an 800+ score (see Why is Credit Important).
To continue learning about credit, see the following articles in the series:
- Why did my credit score drop for no reason?
- Sample Letter to Remove Closed Accounts From Credit Report
- How to Write a Goodwill Deletion Letter to Remove Late Payments
- The Best Way to Check Your Credit Score
- The FICO vs Vantage Credit Scores
You may also be interested in these other articles:
- How to Build Credit with Bad Credit
- How to Build Credit Without a Credit Card
- Why is Credit Important?
- Is 670 a Good Credit Score?
Stephen regularly writes about personal finance, business management, and technology. He’s worked with companies such as Citibank and Micro Focus.