[T]he average FICO score went up back in April of 2014 to 692. While it falls in the range of average credit, it is on the high end. Prior to the recession, the average score was 690.
Increased Responsibility
Two major factors are being attributed for the jump. First, people are being more responsible with their credit today than in the past. When the score dropped, part of the reason was due to the fact that people had lost their jobs and had no way to pay their bills.
Now, two years later, they have jobs once again and are back on track. The only thing that helps improve credit in that situation is time. Pay your bills on time for a few months and you will see your credit score increase.
Stricter Lending Procedures
The second reason behind the trend upward is that creditors have been stricter in handing out credit. Fewer people are getting credit and they are handling it responsibly. Those who are borderline have been turned down. Of course, this means that some people who would be responsible with credit have been denied, but they are working on improving their scores.
People are generally more aware today of their credit scores and what makes up a good one. They have educated themselves and learned how to improve their credit rating. As a result, they are now being offered more credit opportunities.
What the Future Holds
As long as the same mindset stays in place, it is likely that the average FICO score will continue to rise. The danger lies in the fact that many people forget what it was like to not be able to pay the bills or to have more debts than they could afford.
To protect yourself:
• Learn about credit
• Get your free credit report and know what it says
• Use credit responsibly
• Have money saved for unforeseen situations
These steps can help you avoid issues in the future and ensure that you have a credit score that is even better than the national average.