How Do Credit Scores Work?

How Do Credit Scores Work? Practical Money Skills for Work and Life A KY-W.R.A.P. Prosperity Skills Course Your credit score is more than just a number. It can influence your financial opportunities, borrowing costs, and ability to reach important goals. But where does that number come from? Many people know that credit scores matter but don't understand how they're calculated, why scores differ, or what actions can help improve them. This practical KY-W.R.A.P. course explains credit scores in clear, everyday language, helping participants understand how their financial decisions can influence their creditworthiness. What You'll Learn: - Credit Reports vs. Credit Scores: Understand the difference between the information collected about your credit history and the scores calculated from that information. - The Three Credit Bureaus: Learn about Equifax, Experian, and TransUnion and their roles in collecting credit information. - FICO and VantageScore: Discover what these scoring models are and why lenders may use different scores. - What Influences Your Score: Understand how payment history, outstanding balances, credit utilization, account age, and new credit applications can affect your score. - Why Scores Differ: Learn why you may have more than one credit score and why those numbers aren't always identical. -Improving Your Credit: Identify practical habits that can help establish, protect, or improve your credit over time. - Reviewing Your Credit: Understand why checking your credit reports and recognizing inaccurate information matters. Understand Your Score. Strengthen Your Future. Whether you're building credit for the first time, recovering from financial setbacks, or preparing for a major purchase, understanding credit scores can help you make more informed decisions. You don't have to understand every complicated formula to make progress. You simply need to understand which financial behaviors matter