Mon, 05 April 2021 | consumers
According to Experian research, the average FICO® Score hit a record high of 710 last year, a seven point increase from 2019. Several factors may have contributed to this improvement; the recent survey revealed almost a quarter of respondents checked their score more often than before the start of the pandemic, while many consumers surveyed (29%) took steps to prepare for a recession such as cutting back on spending, which remained consistent with those surveyed one year ago (at 32%). Respondents also paid off debt, with fewer carrying credit card balances (a decrease of 13%) and student loan debt (a drop of 6%) compared to last year.
Consumers feel more financially stable today
Survey respondents indicated they feel less worried about personal finances today, with 55 percent feeling concerned vs. 69 percent in 2020. Concerns about credit decreased by 10 percent from one year ago, with 37 percent currently worried. Also, anxiety about the economy fell from 66 percent to 58 percent. Moreover, consumers plan to increase spending in areas such as travel (by 14%) and entertainment (by 8%).
Consumers continue to be financially diligent
Half of consumers surveyed will use the recent stimulus payment to pay down current monthly bills, while 44 percent will put the money into savings. Nearly 2 out of 3 survey respondents say they will find new ways to save money in the coming months, and 36 percent will work to improve or maintain their credit score.
Source: Experian