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The story of one man’s attempt to achieve a perfect 850 credit score is a fascinating tale of determination and obsession with financial perfection. Steve Michell, a 52-year-old engineer from Texas, embarked on a five-year journey to crack the code of credit scoring and reach the elusive 850 mark, as reported by The Wall Street Journal.
The Quest for Perfection
Michell already had an impressive credit score in the 840s, placing him among the top tier of credit holders in America. However, his engineering background drove him to pursue nothing short of perfection, The Wall Street Journal notes. This pursuit led him down a path of meticulous experimentation and analysis.
Michell’s Approach
To achieve his goal, Michell employed several strategies:
- Following app tips: He initially followed advice from his banking app, but later came to doubt its effectiveness, according to The Wall Street Journal.
- Closing credit cards: Contrary to common advice, he closed some of his credit card accounts, as reported by both The Wall Street Journal and Moneywise.
- Adjusting balances: He tweaked the balances on his accounts, The Wall Street Journal states.
- Modifying payment timing: Michell adjusted when he paid his bills, as mentioned in The Wall Street Journal.
After each change, he would wait a month to observe the impact on his score, then make further adjustments based on the results, The Wall Street Journal explains.
The Broader Context
Michell’s quest highlights several important aspects of credit scoring in the United States:
- Growing obsession: His story underscores the increasing fixation Americans have with their credit scores, as noted by The Wall Street Journal.
- Complexity of scoring: The ups and downs in Michell’s score often defied simple explanation, revealing the intricate nature of credit scoring algorithms, The Wall Street Journal reports.
- Expanding influence: Credit scores now impact various aspects of life beyond lending, including renting homes, insurance premiums, and even dating prospects, according to The Wall Street Journal.
- Proprietary algorithms: Despite increased accessibility to credit scores, the exact formulas used by credit bureaus and scoring companies remain proprietary, The Wall Street Journal points out.
Implications and Insights
While Michell’s story is unique, it raises questions about the value of pursuing a perfect credit score. For most people, maintaining a good or excellent credit score (typically above 700 or 750) is sufficient for accessing favorable financial terms, Moneywise suggests. The marginal benefits of increasing an already high score may be limited, especially considering the time and effort involved.
Ultimately, this story serves as a reminder to keep an eye on your credit score and understand its impact on your financial health, as emphasized by a LinkedIn post from Information Banker. However, it also cautions against becoming overly fixated on achieving a perfect number, as the pursuit itself may not yield proportional financial benefits.
Sources:
https://www.cnbc.com/select/freelancer-surprised-by-perfect-credit-score/
