Dear Colleague,
Summer is upon us (at least in the Northeast), after what seemed like an endless winter and an abbreviated spring. And once again we’re congratulating another crop of graduates.
Whether they plan to pursue additional education or to move into the working world right away, most are confident in the knowledge their schooling has given them and eager to make the most of all they’ve learned.
The last thing any new graduate wants to do is take another quiz, but that’s exactly the advice I’d give if I were delivering a commencement speech. Think of it as an extra credit assignment for life: The Credit Score Quiz. Available in English and Spanish versions, the quiz is a short, interactive test that lets young people (and older ones too) find out what they know, and don’t, about credit scoring and its relationship to credit-usage behavior. Developed with our partner, the Consumer Federation of America (CFA), the Quiz also provides helpful explanations of every answer.
Almost anyone can learn a few things by taking the Quiz, but we have good reason to focus our outreach on recent graduates and other young people. The findings of our 2014 Credit Knowledge Survey — which we released in May, in conjunction with CFA —revealed some troubling gaps in credit knowledge among adults younger than 35. These so-called millennial consumers fared significantly poorer than older adults in several topic areas.
Many recent grads are facing student loan payments or are seeking their first car loans, credit cards or other loans. It’s crucial for new grads, and all millennials, to understand credit scores and what influences those scores.
The Credit Score Quiz is based on the survey questions, so it stands to reason that many millennials could benefit from taking the Quiz. I’m encouraging the recent graduates in my life to take the Quiz, and I urge you to do the same. And while you’re at it, suggest they get in the habit of obtaining free credit reports yearly at AnnualCreditReport.com. While it may not be as worthy of framing, a healthy credit report can be as important as a diploma to future financial success.
Rounding out this month’s newsletter is an overview of our latest white paper, which details a relatively quick and simple approach to converting credit scoring models — a method we call “Plug & Play.” You’ll also find an article based on a recent Credit Trends study by Experian, a credit reporting company (CRC) that analyzed current personal debt levels and credit scores for residents of the 20 most populous metropolitan areas in the U.S. This month’s “Did You Know” article clarifies the distinction between credit scores and credit reports. And our “Five Questions” interview is with CFA Executive Director Steve Brobeck.
Enjoy this month’s content.
Warmest regards,
Barrett Burns