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The Fallacy of Focusing on FICO Scores

In the realm of personal finance, credit scores play a significant role in determining one’s borrowing power and financial opportunities. In the United States, the FICO score has become the de facto standard for assessing creditworthiness. However, the growing obsession with FICO scores among American consumers, bordering on worship, is a fallacy that needs careful examination. While maintaining good credit is undeniably important, it is equally crucial to recognize that credit scores should not be the ultimate measure of financial success or be overly emphasized. Let’s delve into this topic, exploring multiple perspectives and citing reliable sources that shed light on the limitations of credit scores as an indicator of financial well-being.

The Credit Score Myth:

One of the primary reasons to question the undue emphasis on FICO scores is the flawed belief that a high credit score equates to financial prosperity. This misconception disregards the larger picture of personal finance, which encompasses savings, investments, and overall financial health. A study conducted by The Brookings Institution ( found that consumers’ focus on credit scores can overshadow important long-term financial planning and discourage building wealth through saving and investment.

The Narrow Scope of Creditworthiness:

Credit scores are designed to evaluate an individual’s ability to manage debt responsibly, with factors such as payment history and credit utilization playing a significant role. However, they do not account for a person’s income, net worth, or overall financial situation. This limited scope can lead to misguided perceptions of financial success. The Federal Trade Commission (FTC) ( highlights the importance of a holistic approach to financial management, emphasizing that credit scores are just one piece of the puzzle.

Missing the Main Point:

Overemphasizing credit scores can perpetuate large corporate banks over-profiting on normal American consumers. A comprehensive study conducted by researchers at the Federal Reserve Bank of Philadelphia ( revealed that consumers who can least afford it, on average, have lower credit scores while still paying a large percentage of disposable income on interest service. Relying heavily on credit scores can miss the main point: financial solvency and surviving without paying 30% interest on purchases. A strong credit score can be helpful IF its used for purchasing homes and/or cars as necessary, but maintaining a FICO score in the 500’s or 600’s while paying 25-30% interest over a decade to pay off a credit card is a poor focus. The main point should be to be debt free from unsecured debt and only use debt for assets such as homes and cars. 

Whats Important, Whats Not:

The Consumer Financial Protection Bureau (CFPB) ( emphasizes the importance of focusing on long-term financial habits rather than obsessing over short-term credit score fluctuations, which can distract from broader financial goals.

For example, if:

You are having to choose between paying a credit card or getting the groceries you need, or you are having to put food and other staples on credit cards, then the profit for the big banks are being prioritized over your financial and living security. 

In no circumstance is it wise financial advise to prioritize paying Chase or American Express their 25% interest rate over a families ability to provide for their needs. 

Imagine a world where your budget wasn’t impacted by thousands of dollars of profit payments per year to multi-trillion dollar banks. 


While credit scores undoubtedly play a significant role in financial matters, it is essential to maintain a broader perspective on personal finance. By recognizing the limitations of credit scores and understanding the factors that contribute to financial success, consumers can make more informed decisions about their financial well-being. The emphasis should shift towards adopting sustainable financial habits, building wealth, and ensuring financial security for the long term. Prioritizing financial literacy, cultivating savings, and diversifying investments should be given equal, if not greater, importance alongside credit scores.

Remember, credit scores should serve as tools to aid financial decisions rather than dictating them. By incorporating multiple financial indicators, such as income, savings, and investment portfolios, individuals can achieve a more comprehensive understanding of their financial health and work towards genuine long-term success.

Should you focus on keeping your 650 fico score and take 15 years to payoff your credit cards? We think not….

Get debt free fast, then rebuild the credit over time as your creditors fall off your credit report with our debt relief options.


The Brookings Institution:
Federal Trade Commission (FTC):
Federal Reserve Bank of Philadelphia

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