Your Credit Score Is Your GPA for Life


I vividly remember my school days. It was a time when my parents relentlessly reviewed my homework, tests, and report cards, and then would admonish me if my grades didn’t measure up. It was a mandate that I fully commit to management of my GPA–and in my parent’s West Indian household, a solid “B” was barely making due. Their philosophy was achieving great grades was a ticket to a better life: the nation’s top colleges, elite graduate schools, and a high-paying job to launch a lucrative career.

Even though education remains a vital factor in securing a life filled with options, there’s another measure that’s equally crucial: your credit score. Having a poor credit score can severely limit or eliminate your access to virtually every aspect of the American dream, including purchasing the home you want, renting a decent apartment, buying a car, gaining a promotion, or securing a job. According to the Society for Human Resources Management, nearly 60% of employers use credit checks as part of the screening process for job applicants. In a prospective employer’s mind, bad credit equals questionable integrity. (From a range of 300 to 850, an excellent credit score is 750 or higher, good is 680 to 740, fair is among the lower 600s, and anything lower is considered subprime.) It’s possible that an individual with a criminal record and a credit score of, say, 720 could have greater financial freedom than a person with a clean slate and bad credit.

Your credit score represents the GPA for your life. A bad score is like a heavy piece of luggage that weighs you down, keeping a slew of opportunities out of reach. If by chance you’re able to engage in major financial transactions or high-ticket purchases, expect to be slammed with obscene interest rates and unnecessary fees, become prey to predatory lending, or have to use cash as collateral. To make my point, I will share a real-life situation in which I witnessed a woman check into a luxury hotel during a conference using a debit card. Instead of just taking an imprint of her plastic as it would have done with a credit card, the hotel placed a hold on the available balance for the entire estimated bill as protection against the woman overspending during her stay. As a result, the hotel held $1,500 of her cash, and she did not have immediate access to her own money.

African Americans continue to be the group disproportionately affected by credit mismanagement. Even during boom times, we had lower credit scores than our white counterparts. According to a recent Washington Post article, data collected by the Federal Reserve in 2003 revealed that less than 25% of African Americans held prime credit scores versus roughly 65% of whites.

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