TL;DR
Credit scores above 750 offer a buffer against life’s financial surprises and may qualify you for special perks with certain lenders, despite many lenders treating scores above 750 similarly.
Story
“Why do credit scores go all the way up to 850 if anything above 750 gets you the same benefits?”. It’s a good question. Imagine a school grading system—A+ (90-100), A (85-89), B+ (80-84), and so on. Why not just “Pass” or “Fail” if a C- is enough to graduate? Credit scores are similar. Lenders use them to assess your likelihood of repaying a loan. While 750 might seem like the magic number for good rates, higher scores offer a safety net. Think of it as a financial cushion. Life throws curveballs—job loss, medical emergencies, unexpected expenses. These events can impact your credit score, and a higher score ensures you stay in the “prime borrower” range, even with minor fluctuations. Like having extra padding in a helmet, a higher score provides better protection. Also, some specialized lenders offer the absolute best terms only to those with scores above 800. While most lenders lump borrowers above 750 together, a few offer special perks for those with exceptional credit. These perks may not always be advertised and might include lower rates, higher credit limits, or preferential treatment. Furthermore, consider the scoring system itself. Different credit bureaus use slightly different formulas, and scores can fluctuate based on reporting times. A higher score gives you a buffer against these variations. Don’t let these fluctuations cause you unnecessary stress and anxiety, so maintain a high credit score. Some say a higher credit score shows financial discipline and stability. But remember, credit scores aren’t the sole measure of financial health. Focus on managing your debt, saving consistently, and investing wisely. A high credit score is helpful, but it’s not the end goal.
Advice
Don’t fixate solely on your credit score. True financial health is about managing debt, saving diligently, and investing wisely. A high score is a tool, not the entire toolbox.