Having a great credit rating is important for a number of different reasons. They help with getting loans, applying for finance, being able to rent, right down to qualifying you for a good job. In short, having a great credit rating makes life easier and slightly less expensive.
So, do older people understand their credit ratings better than most young people?
Research from icount.co.uk reveals that people over the age of 55 are much better equipped to deal with their finances, and as a result, have a better understanding of credit scores.
Over a third of Brits aged over 55 say they completely understand their credit score, whereas younger people lack confidence when it comes to their credit ratings and understanding the implications of credit.
Older people simply have more experience having credit, dealing with their own finances and credit ratings. Older people generally have a lot more experience with credit and understand the implications of it, leading to higher scores.
This is due to them being able to pay back their credit quickly and in full, a result of earning a greater wage than most young people. Over 55s have fewer outgoings than most younger people as their children have left home and most of the time their original loans are paid off.
Credit advantages of the over 55s
Another advantage for those aged over 55s, is that the longer you have credit, the more it improves your score – meaning that mortgages and long term credit repayments can contribute to your credit score in a favorable way.
Young people’s outgoings are typically a lot more than an older person. Having more bills to pay off, young families and large student loans which take decades to pay off mean that younger people are taking out credit and are therefore unable to pay it back quickly.
The research from icount revealed that older people are much better equipped with the knowledge to improve a poor credit score.
These are the top 5 reasons how to improve your credit rating, as agreed by Over 55s
1. Paying your bills on time
Paying your bills and being able to keep on top of what you owe is a simple and easy way to keep your credit score high. Making a note of what you’ve spent will help when it comes to remembering to pay your bill in time.
2. Rectifying and ensuring there are no mistakes on your credit file
This is easy to do if you take the time out to do it every so often, making sure there are no mistakes holding you back and lowering your score will in time ensure your file is clean and score remains high.
3. Long term history of employment
Having the same job for a long period of time indicated to any lenders that you are in a secure financial position, and that you’ll be able to pay back any bills and loans.
4. Long term living in one place
This ensures that your data file doesn’t get lost or mistaken and indicates a good repayment history, whether this is renting or mortgages.
5. Closing any unused credit accounts
Doing this is a simple way to stay on top of your credit, as having too many different credit accounts could lead to confusion and forgetfulness.