New research reveals a huge age discrepancy in credit score attitudes
One of the best ways to better understand your financial position is by checking your credit score, being aware of your score, and learning how to improve it can increase your chances of getting better interest rates on mortgages, loans, and credit cards.
However, new research1 from debt management company, Lowell reveals that the importance of credit scores to Brits across the UK varies widely across by both age and location.
Credit score by age
The research highlighted an obvious age discrepancy around Brits’ attitudes towards credit scores and revealed that the older generation of Brits knows more about credit scores than the younger generation:
Age
% Of people who knew how to check their credit score
16-24
55%
25-34
66%
35-44
68%
45-54
72%
55+
72%
Surprisingly, the research found that almost one-third (32%) of the 16–24-year-olds who know how to check their credit score, check it multiple times a month. According to the data, those aged 55 and over (15%) are most likely to check their credit score just once a month, as well as 35-44-year-olds (11%) and 25-34-year-olds (11%).
Despite the statistics showing that young people are more technically inclined to keep track of their score, people aged over 55 have a better understanding than young people of what affects their credit score. The research showed that almost three-quarters (72%) of Brits over 55 know that missed payments are a key reason as to why your score can be negatively impacted, in comparison to just over three in 10 (35%) of 16-24-year-olds.
In addition to this, it was revealed that over three quarter’s (79%) of 16-24-year-olds do not think ‘buy now pay later’ schemes can affect their credit score.
Credit score by location
Lowell’s study also revealed the best and worst locations for credit score knowledge throughout the UK. The top three cities with the best understanding of how to check their credit scores are:
Cardiff (78%) / Manchester (78%)
Birmingham (76%)
Southampton (75%)
In contrast to this, the city that has the least amount of knowledge on how to check a credit score is Belfast where nearly half (45%) of residents admitted to not knowing how to check their credit score.
Kelli Fielding, managing director of consumer interactive at information and insights provider TransUnion in the UK says:
“Taking control of your credit information is an important step in managing your financial standing and being aware of what your options are in terms of accessing finance when you need it. Whilst it’s great to see many consumers are checking their scores very regularly, there are still some significant gaps when it comes to people’s understanding of how their credit information is used, as these figures show. It’s clear that more education is needed, across all demographics.
“Given the ongoing financial uncertainty brought about by the pandemic, it’s more important than ever that consumers regularly monitor their credit report and score, and that they’re able to understand how this information is used so they can better manage their finances.”
Also commenting on the findings, John Pears, UK CEO of Lowell, says:
“Looking after our financial health is a really important life-skill. This survey reveals just how critical it is for people to have access to the right tools and resources from an early age, helping them to be in control of their finances.
“Your credit score is one of these key tools; it has a huge potential to impact a variety of important life events, such as buying your first house or financing a car. It’s vital that people know and understand their score, what it says about them and importantly the steps they can take to help improve it.
“We want to ensure consumers feel empowered and in control of their finances, which is why at Lowell it’s our goal to help make credit fairer for all. A range of independent and impartial support is available for anyone struggling with their finances. A list of organisations who can help is available at our website.”
