Is a good credit score key to peace of mind?

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Credit Sesame discusses whether a good credit score is key to peace of mind.

The financial benefits of having a good credit score are well-established and include:

  • Easier access to credit.
  • Better credit card offers.
  • Lower interest rates.

Since employers and landlords often check the credit reports of applicants these days, your credit score can even affect where you work and where you live.

These are all tangible financial benefits. But here’s something you can’t put a price on: good credit may give you more peace of mind.

A Credit Sesame survey found a link between credit scores and how people feel about their finances. Survey respondents with good to exceptional credit scores were generally less worried about a recession, more optimistic about the economy and better able to sleep at night.

How worried are Americans about their finances?

The Credit Sesame survey asked over 1,500 adults three questions about how they felt about the economy and their own finances:

  1. Are you worried about a recession?
  2. How do you feel about your financial situation?
  3. How often are you kept awake worrying about money?

The results showed a fair amount of concern among consumers, regardless of credit score, about the economy and their financial outlook.

  • 65% are worried about a recession.
  • 61% describe their financial situation as middle of the road
  • 16% are pessimistic about their financial situation (vs 23.49% optimistic)
  • 47% are kept awake at night at least some of the time

Overall, these figures describe a population that is cautious but not overly fearful about the financial future. However, the responses took on a different character when segmented by credit score.

Is credit score key to how people feel?

Segmenting responses by high credit scorers (670 and higher, good to exceptional credit) and lower credit scorers (669 and under, fair to poor credit) yielded a different picture.

Worry indicator670 or higher669 or lower
Worried about recession63%71%
Optimistic about finances28%16%
Middle of the road about finances60%61%
Pessimistic about finances12%23%
Kept awake worrying36%69%

Recession fears are widespread, and even people with good credit scores are not immune. However, they are less worried about a recession than people with lower credit scores.

From a mental health point of view, perhaps the most important indicator is how they feel about their finances when their head hits the pillow at night. Being kept awake by money worries may affect the way people function socially and professionally.

In 2023, consumers generally are concerned about the economy. The Credit Sesame survey results indicate that concern is more prevalent among people with lower credit scores.

Does a high credit score correlate with peace of mind?

Financial knowledge and personal finance management skills often go along with a high credit score. People with a higher credit score have behaved responsibly with credit and debt in the past.

But in and of itself, a high credit score does not give peace of mind. Many other factors affect how individuals feel about their finances. For example,

  • Income
  • Expenses
  • Debit
  • Savings and investments
  • Job security
  • Health care costs
  • Family and dependents

Consumers who understand and control all these factors as part of good financial management are more likely to have a higher credit score. In other words, having a high credit score does not guarantee peace of mind. However, having responsible habits that lead to a good credit score is likely to give you more confidence around your personal finances.

Credit improvement is a gradual process involving the development of good financial habits and does not happen overnight. But a commitment to raising your score, perhaps using a credit builder tool and by following good advice can make a difference faster than you may imagine. Your new and improved credit score could indeed come with more peace of mind around your personal finances.

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Survey methodology

The Credit Sesame Credit Health and Financial Fitness Survey December 2022 was designed and executed by Credit Sesame using the WebEngage survey tool. The survey sample comprised over 1,500 Credit Sesame members with a credit score distribution resembling the U.S. general population. In aggregate the sample data is accurate with a 2.5% margin of error using a 95% confidence level.

Disclaimer: The article and information provided here is for informational purposes only and is not intended as a substitute for professional advice.

Richard Barrington
Financial analyst for Credit Sesame, Richard Barrington earned his Chartered Financial Analyst designation and worked for over thirty years in the financial industry. He graduated from St. John Fisher College and joined Manning & Napier Advisors. He worked his way up to become head of marketing and client service, an owner of the firm and a member of its governing executive committee. He left the investment business in 2006 to become a financial analyst and commentator with a focus on the impact of the economy on personal finances. In that role he has appeared on Fox Business News and NPR, and has been quoted by the Wall Street Journal, the New York Times, USA Today, CNBC and many other publications.

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