Inside look into a millionaire’s credit score.

Ever wonder how a millionaire’s credit score looks in more detail? I always did in the past so just thought I would share. I used a lot of credit for investments in the past but as time went by I began to slowly reduce my usage. I began buying things with cash rather than credit. You will see I’m fairly conservative with my borrowing.

Credit Card Usage (HIGH IMPACT)

Keep your credit usage between 1-5% every month. Not using your credit can be a negative so use your credit and pay off balances in full. Make sure you use all your cards at least once every 6 months to keep them open and active.

Payment History (HIGH IMPACT)

Never missed a payment. If you ever forget to make a payment simply give the card company a call as soon as possible and request to have the late payment penalty waved. They would often do so as long as it is your first time.

Derogatory Marks (High Impact)

This one is very important because one derogatory mark can stay on your report for up to 7-10 years.

Credit Age (Medium Impact)

My credit age was always between 3-5 years. I did close few old accounts many years back which led to the lower age. If I held those accounts my credit age would average to be much higher today I assume. From my experience as long as you keep this factor between 3-5 years you can easily achieve a score above 800.

Total Accounts (Low Impact)

The more account history the better. I recommend you open a lot of accounts early in your age and take the lower credit score. Once you have around 8 accounts you can taper off opening accounts to improve that credit age. Afterwards, never close an account if you don’t have too.

Hard Inquires (Low Impact)

This one is interesting. Sometimes when I am shopping for loans for investments I rack up quite a few inquiries. Once I had up to 6 and my credit score dropped below 800 to around 780. I would probably try to keep this score below 3-4 if you wish to achieve the 800+ score.

Personally, I believe any credit score above 750 is sufficient enough to score great rates. Scoring above 800 is a nice credit cushion to have for those unexpected investment opportunities. The highest score I ever achieved was 840 few years back but that was short lived. What is your credit score? How do you take advantage of your higher credit scores? Love to hear from you guys! Exciting times!