Fico Score Research Paper

The FICO Score is known to all responsible adults with respect to their credit payments. Most teenagers don’t have this responsibility yet or even know what this is. It is crucial to introduce this concept to young adults. FICO Scores have several moving parts and can be difficult to understand. So it is important for students to break it down a find a commonality between the five gears of the FICO Score and things that they already comprehend.
The FICO Score consists of five core factors: Payment History, Amounts Owed, Length of Credit History, Credit Mix, and New Credit. Personally, to wrap my head around these parts of a credit score, I related each piece with grades and classes. “Payment History” is 35% of your credit score. This is your punctuality of payments; have …show more content…
“Amounts Owed” is 30% of your credit score. This is the amount of current debt you have or owe. It corresponds with missing or late assignments due to having too much on your plate. But if assignments (payments) continue to miss the expected deadline, this will be shown negatively on your part. If you fail the class, you will have to make up for it over the summer. If you fail to turn in your payments, you will have to pay more than you intended. “Length of Credit History” is 15% of your credit score. This means that a longer credit history will increase your FICO Scores, but it is possible to have a high score without a long credit history. For example, a requirement for graduation is to take a language class for at least two years, but it is highly recommended by colleges to take the class for four years. You will not be penalized if you do the minimum. “Credit Mix” is 10% of your credit score. This is the types of credit and creditors you have used. It's not a good idea to open credit accounts you don’t intend to use. This is like having extracurricular activities; it is the student’s responsibility to maintain

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