Your credit score, level of income and amount of outstanding debt are all crucial elements that make up your financial profile.
Understanding these numbers helps you determine what credit you have access to, what you can afford and what obligations you owe. But sometimes it helps to get the bigger picture of what is "normal," or the average, so you can see how you measure up and any progress that you can make.
So you can see how your numbers stack up to the average American consumer, Select asked Experian, one of the three main credit bureaus, to share a snapshot of the average borrower data across U.S. consumers. Here is what we found.
Snapshot of the average borrower: Their credit score
Experian's most recent data from Q1 2020 shows that the average borrower in the U.S. has a 703 FICO credit score.
On the FICO credit score scale ranging between 300 on the low end to 850 on the high end, a 703 falls under "good."
- Poor: 300 to 579
- Fair: 580 to 669
- Good: 670 to 739
- Very good: 740 to 799
- Exceptional: 800 to 850
Having a 3-digit score that falls within this "good credit" range is worthwhile and it can certainly make a difference when applying for a loan or new credit card. In fact, a good credit score is essential if you want to qualify for cards that offer competitive rewards and generous welcome bonuses.
For example, the recently launched Chase Freedom Flex℠ made the Select ranking of best credit cards for good credit because of its sign-up offer: New cardholders earn $200 cash back after spending $500 on purchases in their first three months. That's almost half your money back into your wallet. Plus, earn 5% cash back on combined gas station and grocery store purchases (excluding Target and Walmart) on up to $12,000 spent in the first year.
Chase Freedom Flex℠
Rewards
5% cash back on up to $1,500 in combined purchases in bonus categories each quarter you activate (then 1%), 5% cash back on travel booked through the Chase Ultimate Rewards®, 3% on drugstore purchases and on dining (including takeout and eligible delivery services), 1% cash back on all other purchases
Welcome bonus
Earn a $200 bonus after you spend $500 on purchases in the first 3 months from account opening. Plus, earn 5% cash back on combined gas station and grocery store purchases (excluding Target and Walmart) on up to $12,000 spent in the first year.
Annual fee
$0
Intro APR
0% for the first 15 months from account opening on purchases and balance transfers
Regular APR
20.49% - 29.24% variable
Balance transfer fee
Intro fee of either $5 or 3% of the amount of each transfer, whichever is greater, on transfers made within 60 days of account opening. After that, either $5 or 5% of the amount of each transfer, whichever is greater.
Foreign transaction fee
3%
Credit needed
Excellent/Good
Member FDIC. See our methodology, terms apply. Information about the Chase Freedom Flex℠ has been collected independently by Select and has not been reviewed or provided by the issuer of the card prior to publication.
Read our Chase Freedom Flex℠ review.
Pros
- No annual fee
- Generous welcome bonus
- Opportunity to earn up to 5% cash back in select categories upon activation
- Rewards can be transferred to a Chase Ultimate Rewards card
Cons
- Bonus categories must be activated each quarter
- 3% fee charged on foreign transactions
And if you want a credit card that lets you take advantage of interest-free financing, the Citi Simplicity® Card offers an introductory 0% APR for the first 21 months from date of first transfer on balance transfers and 0% APR for 12 months on purchases from date of account opening (after, 19.24% - 29.99% variable APR; balance transfers must be completed within four months of account opening). Though we recommend always paying off your balance on time and in full every month, this helps provide some wiggle room for those big purchases.
Citi Simplicity® Card
Rewards
None
Welcome bonus
None
Annual fee
$0
Intro APR
0% Intro APR for 21 months on balance transfers from date of first transfer and 0% Intro APR for 12 months on purchases from date of account opening.
Regular APR
19.24% - 29.99% variable
Balance transfer fee
There is an intro balance transfer fee of 3% of each transfer (minimum $5) completed within the first 4 months of account opening.
Foreign transaction fee
3%
Credit needed
Excellent/Good
See our methodology, terms apply.
Read our Citi Simplicity® Card review.
Pros
- No annual fee
- Balances can be transferred within 4 months from account opening
- One of the longest intro periods for balance transfers
Cons
- 3% foreign transaction fee
- No rewards program
Snapshot of the average borrower: Their income and debt levels
The average borrower has an estimated $88,255 yearly income and an average $94,081 in total debt, according to Experian's Q1 2020 data.
As expected, these numbers fall right between prime and subprime borrower data. Prime borrowers have an average $98,206 yearly income and $110,110 in total debt, while subprime borrowers have an average $68,567 yearly income and $55,135 in total debt.
We can analyze from these numbers that those with higher credit scores also have more income and debt obligations. Having debt may not be ideal, but when you pay your monthly bills for those obligations every month on time, that can help your credit score. Not to mention, having a mix of credit (credit cards, student loans, car payments, a mortgage) helps improve your score because it shows that you can manage different types of debt.
Experian provided the below additional data for the average consumer:
- Credit cards: 4
- Credit card balance across all cards: $6,144
- Additional retail / store credit cards: 3
- Retail / store credit card balance across all cards: $1,162
- Student loan balance: $37,161
- Auto balance: $19,527
- Mortgage balance: $207,402
As you observe the data above and compare to your own, know that everyone's financial picture is different and the numbers don't tell the whole story.
A good credit score is something smart to strive for, but you won't get there by taking out a bunch of credit cards and loans. The key is to have enough credit that you can manage, given your own personal income and debt obligations, and that you borrow strategically according to your needs.
