If you want to improve your credit health, you’re likely wondering what actions to take. Or maybe you already have a plan in mind and aren’t sure if executing it will help you achieve your credit goals.
Either way, the Experian Credit Score Simulator can be useful. It’s a tool available through the CreditWorks subscription that provides insights into how certain actions may affect your credit score. You can input and simulate specific scenarios and get an estimate of how much your score may increase or decrease.
Here’s what you need to know about this valuable resource and how to get started.
What is the Experian Credit Score Simulator?
The Experian Credit Score Simulator is an interactive digital tool designed to help you predict how different financial scenarios can impact your credit rating. It’s based on the FICO Score 8 model.
You can see how various actions, such as paying down credit card balances, opening a new loan or credit card account, or placing a specific charge on one credit card or another, can affect your credit score. With this information, you’ll be equipped to make smart credit decisions.
How Your Credit Score is Calculated
FICO Scores range from 300 to 850 – the higher, the better. They are calculated based on the data found in your credit report, which is provided by information furnishers.
Here’s a closer look at the FICO credit-scoring formula:
- Payment history (35 percent of your FICO Score): It takes into consideration whether payments have been made on time, any missed or late payments and any delinquencies or defaults. (Note: Delinquent accounts aren’t reported until they are 30 or more days past due).
- Amounts owed (30 percent of your FICO Score): It considers the total amount owed across all accounts, as well as the amount owed on specific types of accounts. Credit utilization, or the amount of your credit limit in use on revolving accounts, is another significant component.
- Length of credit history (15 percent of your FICO Score): It considers the length of time accounts have been open and the length of time since the last activity on each account.
- Credit mix (10 percent of your FICO Score): It considers the type of credit accounts you have – either revolving (i.e., credit cards and lines of credit) or installment (i.e., personal loans, student loans, auto loans, mortgages).
- New credit (10 percent of your FICO Score): It considers the number of hard credit inquiries and recently opened accounts.
Understanding the Experian Credit Score Simulator
Now that you’re familiar with the FICO credit-scoring model, below is an overview of what to expect when using the Experian Credit Score Simulator.
How the Experian Credit Score Simulator Works
Some credit score simulators require you to answer a series of questions, using your responses to estimate your credit score changes. Experian’s simulator uses a similar approach, offering several powerful features to give you better insights into your credit score.
Using the Experian Credit Score Simulator
To make the most out of the Experian Credit Score Simulator, you’ll first need to provide information about your current financial situation and what actions you may take. Based on your inputs, the simulator will generate projections of how they might impact your credit score.
By experimenting with these scenarios, you’ll gain a clearer understanding of how potential financial decisions can affect your credit score, enabling you to make more informed decisions as you work towards improving your credit health. Remember, the Experian Credit Score Simulator is a helpful tool for educational purposes. Still, it’s important to note that the actual impact on your credit score may vary based on real-life circumstances.
Scenarios You Can Simulate Using the Experian Credit Score Simulator
Here are the various scenarios simulated with this valuable tool.
Predicting the Impact of Credit Card Balance Increase
The Experian credit score simulator allows you to see how increasing your credit card balance may affect your credit score. You can input various balance amounts to determine how your score might change. By understanding the potential impact on your credit score, you can make more informed decisions about managing your credit card usage.
The Effects of Paying Off Debt
Another helpful scenario simulated by the Experian credit score simulator is the effect of paying off your debt. When you enter specific amounts to pay off your current debts, the tool provides an estimated credit score change. This information can help you prioritize which debts to tackle first and visualize the positive influence of reducing debt on your credit score.
The Impact of a New Credit Card
Opening a new credit card can have both positive and negative effects on your credit score. The Experian credit score simulator lets you simulate the impact of adding a new credit card to your credit profile. Doing so helps you understand how your credit score might be affected by credit applications and whether it’s the right time to apply for a new card. Again, remember that the simulator can only provide an estimated credit score change, so your actual score may vary.
Maximizing The Benefits of Experian Credit Score Simulator
Below are some ways you can leverage Experian’s Credit Score simulator to improve your credit health.
Getting Valuable Insights Into Your Credit Score
By using the Experian Credit Score Simulator, you can gain valuable insights into your current credit score. As mentioned above, the simulator works by taking information from a questionnaire and estimating your credit score based on your answers. With this tool, you can identify areas where your credit score is strong and areas that may need improvement.
Improving Your Credit Score Based on Simulation Results
Once you have a better understanding of your credit score, you can start making informed decisions to improve it. One option is to utilize Experian Boost – a free service that may instantly lift your FICO® Score provided by Experain by adding your on-time payments for eligible utility, phone, and streaming services to your Experian credit file. This may result in an increase in your credit score from Experian, especially if you have a history of timely payments.
You can also take the following steps to improve your credit score:
- Pay your bills on time and in full
- Keep your credit utilization low
- Limit new credit inquiries
- Monitor your credit report for errors and discrepancies
Avoiding Negative Impacts on Your Credit Score
Understanding the possible negative impacts on your credit score can help you avoid actions that might lower it. The Experian Credit Score Simulator allows you to see the potential consequences of various decisions, such as applying for new loans or closing old accounts.
How Accurate is the Experian Credit Score Simulator?
As with any credit score simulator, keep in mind that the accuracy of the simulations is limited. While these tools can help you understand the possible effects of different financial decisions, they cannot guarantee that the simulated outcomes will entirely match the real world.
How to Access the Experian Credit Score Simulator
To access the Experian Credit Score Simulator, you’ll first need to sign up for an Experian CreditWorks Premium plan. This can be done by visiting their website and following the prompts to create your profile. Once your account is set up, you’ll have access to a variety of services, including the credit score simulator.
The CreditWorks Premium membership also includes credit monitoring for the three major credit bureaus – Experian, TransUnion, and Equifax, daily Experian credit report and FICO score updates, monthly three-bureau credit report and FICO score updates and industry-specific FICO scores. You also get access to Experian Boost to improve your credit score in real-time, Experian CreditLock, identity theft monitoring and protection, and so much more. Even better, it costs just $24.99 per month following the free 7-day trial.
Another way to access the simulator is through the Experian Go service. This platform assists you in establishing your credit, offering personalized recommendations to achieve and maintain a healthy credit status. Simply sign up for the service and follow the provided steps to reach the credit score simulator.
The simulator is also available on Experian’s mobile app. Download the app, sign up or log in using your Experian account, and look for the credit score simulator feature. The mobile app allows you to conveniently monitor and analyze your credit score anytime while at home or on the go.