An 800 credit score has more purchasing power than 100k

Q: What does it mean to have a credit score over 800?

Your 800 FICO® Score falls in the range of scores, from 800 to 850, that is categorized as Exceptional. Your FICO® Score is well above the average credit score, and you are likely to receive easy approvals when applying for new credit. 21% of all consumers have FICO® Scores in the Exceptional range.

Q: How rare is an 800 credit score?

This score isnt perfect, but it places you in the exceptional credit score range. Thats the highest tier of FICO® Scores☉ , which are used by 90% of top lenders. Having an 800 credit score or better is fairly uncommon: Only 23% of all consumers have FICO® Scores of 800 or higher.

It’s the holy grail of FICO credit scores: the seemingly bullet-proof credit score of 800 and above. For an over-achiever it’s a badge. For the credit-proud, a testament of hard work. But…is it worth pursuing?

Table of Contents Show

First up: What does an 800 credit score mean?
Wondering how to get a credit score of 800+?
How do you keep an 800 credit score?
What life is like with an 800 credit score
Can you get anything with a 800 credit score?
What does it mean to have a credit score over 800?
How rare is an 800 credit score?
Is there a difference between a 750 and 800 credit score?

First up: What does an 800 credit score mean?

An 800 credit score with FICO (the Fair Isaac Cooperation) is practically the credit score dream. A credit score of 800 will get you into the “exceptional” category of credit scores as it’s near the top of the credit score range (which goes from 300 to 850). And having an excellent credit score can come with some pretty great perks (which we dive into below). But first, let’s talk about what you can do to build that good credit.

Wondering how to get a credit score of 800+?

To see what goes into the credit scoring process for a high credit score like an 800+ score, we combed through sources like FICO’s blog.

Paying on time matters: FICO says people with high credit scores have a history of making monthly payments on time (so late payments are a no-go if you want a high credit score). Plus, payment history accounts for 35% of your FICO score. It’s kind of a big deal.
Debt vs credit matters: The ratio of your debt compared to the amount of credit that’s available accounts for up 30% of your FICO score. When credit utilization becomes lopsided (as in using up a lot of your available credit), you can weaken your score. Experian, one of the three major credit bureaus, found that people with excellent credit scores (i.e. 800-plus) use on average less than 10% of their available credit total and on each individual credit card.
How long you’ve had credit matters: Your credit history is a track record, and FICO says higher credit scores tend to be linked to longer histories. It’s why closing an older credit card account could have negative consequences; it essentially shortens your credit history.

On this last point, the credit bureau TransUnion has mentioned that in order to begin building credit earlier, you can be added as an authorized user on a parent’s credit card. Just keep in mind that there could be risks associated with being an authorized user, like if the account holder has a poor credit history.

Learn more: What You Need to Know About Being An Authorized User On a Credit Card.

How do you keep an 800 credit score?

Credit scores change because of things you can control, like applying for a new credit card, which could impact your credit portfolio, just as closing credit card accounts can, too.

But credit scores can also be affected by things you don’t have control over, like fraud. A good way to watch out for fraud or keep errors off of your credit reports is through credit monitoring:

You’re entitled to receive a free credit report from each of the credit bureaus - Equifax, TransUnion, and Experian - once every 12 months. Credit monitoring is also a good personal finance habit to do no matter what.

What life is like with an 800 credit score

In addition to bragging rights, having and maintaining an 800+ credit score could come with some additional benefits: you’re considered to have an excellent credit score. As such, lenders are more likely to approve a loan or credit account, as well as offer you lower interest rates.

It’s possible that you also could receive a higher credit limit as a result of your excellent credit score, and qualify for top rewards credit cards that let you earn cash back and/or miles on your purchases. And with more credit card options, you’ll also have more options when it comes to cards’ annual fees (or no annual fee).

Opinions expressed by Entrepreneur contributors are their own.

We live in a country where a healthy credit score and having the ability to borrow money is seen as one of the biggest accomplishments in personal finance. Even though most of us know the importance of having good credit and reviewing our credit report and score regularly, so many people still have no idea what goes into this mysterious number and how to actually improve it over time.

First thing's first: Make sure you understand the difference between a credit report and credit score. Your credit report is a huge file about you and your credit history. It includes your personal information, a summary of your financial accounts, if you've filed for bankruptcy in the past and any past inquiries made.

Your credit score is your FICO number, which lenders use along with your credit report to determine how risky a borrower you are. Your credit score can range anywhere from 300 to 850, and the higher the score, the better. When you apply for a car loan, student loan, home loan or credit card, your credit score is used by the lender to determine how much they will lend you and what your interest rate will be. The more risky you seem, the lower the limit they'll give you -- and the higher the interest rate they'll charge.

Related: 5 Steps to Take Control of Your Personal Finances

So now that you understand the difference between your credit report and credit score, let's review the five factors that go into calculating your credit score.

Payment History. For example: Are you paying your bills on time? This accounts for about 35 percent of your score.
Total Amount Owed. According to Mint.com, you should strive to keep your score healthy by using less than 30 percent of available credit across all your credit cards. This factor accounts for 30 percent of your score.
Length of Credit History. This factor accounts for 15 pecent of your score. Getting an early start on building credit is essential.
New Credit. This includes the number of recently opened accounts and credit inquires you've made, for example. It accounts for 10 percent of your score.
Types of Credit Used. Car loans, mortgage and credit cards fall under this category. This accounts for 10percent of your score.

The goal is for your score to be above 760. This means you have excellent credit. If you have credit below 620, you are considered a subprime borrower, or more risky.

Related: How to Fix Mistakes on Your Credit Report

How does this all play out in your financial life? Making sure you have good credit is a given. But the difference between high and low credit scores can mean thousands of dollars saved over the course of your lifetime when it comes to borrowing money. Let's look at an example.

Let's say you are ready to buy your first home. You work with a mortgage broker to pre-qualify for a $500,000, 30-year fixed home loan. Your credit score is 620, so you get a mortgage loan approved at a 5 percent interest rate. This equates to a monthly mortgage principal and interest payment of about $2,685 per month. Over the course of 30 years, your total principal and interest payments equal $966,600. So on your $500,000 mortgage loan you will pay approximately $466,600 in interest over 30 years.

Now let's say your credit score is 760, so you get a mortgage loan approved at a 3.5 percent interest rate. This equates to a monthly mortgage principal and interest payment of about $2,245 per month. Over the course of 30 years, your total principal and interest payments will equal $808,200. So on your $500,000 mortgage loan you will pay approximately $308,200 in interest over 30 years.

Just by having the better credit score, you could potentially save $158,400 in interest over the course of 30 years! That's a lot of money and that's why having a good credit score is very important.

You want to get in the habit of checking your credit score at least once per year. You can go to sites like www.annualcreditreport.com to access your credit report for free once per year, then pay an additional fee to get your credit score. Other sites, such as www.creditkarma.com will allow you to monitor their version of your credit score, which is similar to your FICO score, for free on a regular basis.

Remember, it's up to you to take control of your financial future. Start with baby steps and take time to really understand the importance of having a good credit score.

Related: 7 Things You Need to Do With Your Money Right Now

Can you get anything with a 800 credit score?

An 800-plus credit score shows lenders you are an exceptional borrower. You may qualify for better mortgage and auto loan terms with a high credit score. You may also qualify for credit cards with better rewards and perks, such as access to airport lounges and free hotel breakfasts.

What does it mean to have a credit score over 800?

Your 800 FICO^® Score falls in the range of scores, from 800 to 850, that is categorized as Exceptional. Your FICO^® Score is well above the average credit score, and you are likely to receive easy approvals when applying for new credit. 21% of all consumers have FICO^® Scores in the Exceptional range.

How rare is an 800 credit score?

This score isn't perfect, but it places you in the exceptional credit score range. That's the highest tier of FICO^® Scores^☉ , which are used by 90% of top lenders. Having an 800 credit score or better is fairly uncommon: Only 23% of all consumers have FICO^® Scores of 800 or higher.

Is there a difference between a 750 and 800 credit score?

Learn more about your credit score A 750 credit score is Very Good, but it can be even better. If you can elevate your score into the Exceptional range (800-850), you could become eligible for the very best lending terms, including the lowest interest rates and fees, and the most enticing credit-card rewards programs.