What is the Starting Point for a Credit Score When Someone Turns 18?

Question: What is the starting point for a credit score when someone turns 18?

When someone turns 18 and has not yet established any credit history, they technically do not have a credit score. According to Experian, one of the three major credit bureaus in the U.S., a person must have at least one account open for six months or more, and at least one creditor reporting their activity to the credit bureaus within the past six months for a FICO Score to be calculated.

How Can an 18-Year-Old Establish a Credit Score?

There are several ways for an 18-year-old to start building their credit history:

  • Apply for a secured credit card: This type of card requires a cash deposit that serves as the credit line. It’s designed for people with no credit or poor credit.
  • Become an authorized user: If a parent or guardian has good credit, they can add the 18-year-old as an authorized user on their credit card. This can help establish a credit history.
  • Apply for a credit-builder loan: These small loans are offered by some credit unions and banks to help individuals build credit.
  • Pay bills on time: While not all utility companies report payments to the credit bureaus, some do. Making payments on time can help establish a positive credit history.

What is the Average Credit Score for 18-25 Year-Olds?

Once an 18-year-old has established a credit history, their credit score can range widely depending on their financial behavior. According to Experian “What Is the Average Credit Score in the U.S.?” article, the average FICO Score in the U.S. for Generation Z (18-25) in 2022 was 679. However, it’s important to note that credit scores can vary significantly based on individual circumstances and behaviors.

In conclusion, the starting point for a credit score when someone turns 18 is essentially zero, as they have not yet established a credit history. However, there are several steps they can take to begin building their credit and establishing a credit score.

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