Editor’s note: This article was originally published in June 2021.
Getting your credit score above 800 earns you elite status. Just 21% of consumers have a credit score of 800 or above, according to Experian. An 800 credit score means you’ll qualify for the best lending terms. That can lead to serious savings over time.
But just how hard is it to get an 800 credit score? The Penny Hoarder spoke to several people with credit scores above 800 to find out exactly what they’ve done to earn a high credit score.
9 Habits of People With 800 Credit Scores
While many people with 800 credit scores have diligently managed their money for years, plenty admit that they’ve made mistakes with credit in the past — so it is possible to recover even if you’ve been less than perfect. If you’re wondering how to get an 800 credit score, copy these nine habits that people with nearly perfect credit scores have in common.
Habit 1: They Never Miss Payments
This one isn’t exactly secret. But the No. 1 thing people who have hit the 800 mark have in common is that they never miss payments or pay their bills late. Only 6% of people with a credit score above 800 have a missed or late payment on their credit report, according to Experian.
Your payment history accounts for 35% of your FICO score, more than any credit factor. A missed or late payment will stay on your credit report for seven years, though the damage to your credit score is most acute in the first two years.
Habit 2: They Make Their Own Payment Schedule
Plenty of people with credit scores in the 800s simply pay their bills once a month using autopay. But a lot of them find that making more frequent payments manually is key to their success. Many make payments weekly, biweekly or as soon as the balance posts if they’ve made a major purchase.
Phillip Godinez, a financial coach with Reach Your Goals Personal Finance Coaching makes payments on the 15th and 30th of the month after he gets paid. Doing so has helped him attain a nearly perfect credit score of 840.
“On the 15th, I login and pay all of my bills that are due between the 15th and the 30th,” Godinez said. “On the 30th, I pay all of my bills that are due between the 1st and the 15th. Keeping a set schedule helps me remember. Since I’m not likely to get any more money between paychecks, I prefer this method to take care of everything and not have to worry about it again for a couple of weeks.”
Habit 3: They Don’t Carry a Balance
One of the best things you can do for your credit score is keep your credit utilization ratio low. Your utilization ratio is the percentage of your open credit that you’re currently using.
The standard recommendation is to keep it lower than 30%, but most members of the 800 club say they keep theirs below 10%. Most report paying off their full credit card balance every month, though a few make an occasional exception for major purchases, particularly if they have a temporary 0% interest period.
Antonio Talledo, founder of Limon Financial, has achieved an 807 credit score since getting his first credit card about 12 years ago. Though he used to carry balances, he now pays off the bill in full on the first of every month.
“I would say the biggest impact to my credit score was lowering my balances to below 10% initially and now 0%,” he said. “A couple of years ago I was carrying about 30% balances and my score was below 700.”
Habit 4: They Don’t Cancel Old Credit Cards
People with top-notch credit rarely cancel old credit card accounts, even if they’ve paid off the balance. The reason is twofold: When you close a card, you lower your available credit, which increases your utilization ratio. Unless it’s one of your newer cards, you also lower the average credit age, which determines 15% of your score.
Andrew Chen, founder of the website Hack Your Wealth whose credit score is over 800, suggests only canceling old accounts if you’re sure you’re not going to use the card again, the annual fee is expensive and the card is relatively new, ideally less than two years old.
“I especially urge [against] closing card accounts that have no annual fee,” Chen said. “It costs you nothing to keep the card, and it helps your credit score to have seasoned credit accounts on your credit file.”
Habit 5: They Use Their Cards Regularly
Once you have an exceptional credit score, you qualify for cards with some pretty sweet credit card rewards. But people with a high credit score typically use all their cards from time to time — even those older cards that don’t offer flashy perks. If you don’t use a card regularly, the credit card issuer can cancel you for inactivity. That will decrease your credit limits and your credit age, both of which are bad for your score.
Alli Williams, founder and CEO of FinanciALLIFocused, keeps her oldest card open for this reason and only uses it for subscriptions. “This card isn’t the best for rewards points, so I am not missing out on much by just putting a few small subscriptions on it,” she said.
Habit 6: They Apply for New Credit Selectively
People with excellent credit scores are selective about applying for new credit. New accounts can lower your age of credit. Also, when you apply for credit, it results in a hard inquiry to your credit report. Too many credit inquiries or multiple credit inquiries within a short time frame can damage your credit score.
Most people with an 800 credit score say they apply for new credit accounts no more than twice a year — and many apply far less frequently.
Annette Harris, owner of Harris Financial Coaching, said that she and her husband have each maintained credit scores above 800 for the past five years. They apply for new credit about once every three years, typically only for credit cards that offer rewards points.
“When we apply for credit cards we are very selective and ensure there is no annual fee associated with the card and that the interest rate is below 13%,” Harris said.
Habit 7: They Ask for Frequent Credit Limit Increases
Instead of opening new accounts frequently, people an 800 credit score often seek credit limit increases on existing accounts — and they never say “no” to a limit increase when their credit card issuers offer one. A limit increase lowers your credit utilization without lowering your credit age. Often, you can avoid a hard inquiry as well.
Habit 8: They Use Credit Freezes
Credit freezes are a popular tool among people with nearly perfect credit scores. A credit freeze blocks access to your credit reports, making it harder for scammers to apply for credit in your name. You can contact each of the three credit bureaus to set one up. As of September 2019, it’s free to freeze and unfreeze your credit.
“This used to cost $10 per action,” Chen said. “Since it’s now free, there is no reason to not freeze your credit. It protects you by prohibiting unauthorized access to your credit file and is an effective way to protect your credit.”
Habit 9: They Don’t Obsessively Monitor Their Credit Scores
People who have excellent credit tend to be vigilant about monitoring their credit. Many use a free credit-reporting service and pull all three of their credit reports yearly using AnnualCreditReport.com. But beyond that, they really aren’t obsessing too much about their scores. Their scores are high because of the good financial habits they’ve developed over time.
Tyler Ellis, founder of Don’t Panic, Do This!, is 28 and has had a credit score over 800 for several years. He uses just one credit card to get points, then pays it off immediately, though he keeps a second in case his main card gets lost or stolen.
“I bought my car cash and paid off my student loans fairly quickly, so the only debt I keep at all is my mortgage,” Ellis said. “Beyond that, I’ve never done anything special to try and artificially boost my credit score. I just don’t spend money I don’t have.”
Do You Really Need an 800 Credit Score?
An 800 credit score will certainly get you bragging rights, but don’t panic if you’re not there yet. The good news is you’ll qualify for the best lending terms and lowest interest rates if you have a good credit score — in the mid-700s. Regardless of where your credit is at, to improve your credit score, you’ll need to do the following:
- Make on-time payments. By making on-time payments for six months to a year, you’ll start seeing improvements to your FICO scores. Within two years, the damage from late payments will also start to fade.
- Lower your credit usage. Paying down your credit card balances and asking for higher limits will increase your credit score. Reducing credit card debt has a bigger impact than paying down a car loan or student loans because it lowers your credit utilization.
- Be patient. Credit history takes time to build. No one gets an 800-plus credit score overnight. Stick with your oldest account to maintain the highest credit age possible.
- Be vigilant. Use a free credit monitoring service so that you’ll get alerts about any changes to your credit report. Also be sure to check your credit reports with the three major credit bureaus — Equifax, Experian and Transunion — once a year using AnnualCreditReport.com. Dispute any information that’s inaccurate directly with the credit bureaus.
By finding a payment system that works for you and spending within your means, you too can get an 800 or higher credit score. But think of it as a long-term goal. Improving your credit score will increase your odds of approval when you seek financing and lower your interest rates. That’s worth celebrating, even if you don’t hit the 800 mark.
Robin Hartill is a certified financial planner and a senior writer at The Penny Hoarder. She writes the Dear Penny personal finance advice column. Send your tricky money questions to [email protected]