Credit Score Counsel

Listen; if you are browsing the web in search of your FICA credit score, my hunch is you are pretty confused.

Why do I say this?  Because a FICA credit score is not the same as a FICO credit score.

I’m telling you, online you may find the terms used interchangeably, but believe me, the two are unrelated financial terms.

So, to clear up the confusion and get you on the right track, you’ll discover as you finish this article the gigantic difference.

Let’s get started…

One things for sure, FICA is the acronym for Federal Insurance Contribution Act.  You may not know this but this act was created with Social Security and Medicare in mind.

In short, FICA was created to mandate that you and employer both contribute a certain percentage of your income to this tax.  This is to secure the Social Security and Medicare programs.

That’s right.  FICA ensures the 6.2 percent of your paycheck makes it way into this fun.  Your employer is responsible for an additional 6.2 percent.

And that’s that as far as that term is concerned.

So, how on earth does a FICA credit score affect you?

Truth be told…it doesn’t.  I hate to say this but it doesn’t exist.

Whew!  Now that we’ve got that cleared up.  Here’s the deal about your FICO credit score.

To make a long story short, your FICO score is the score that lenders use to determine whether or not they will provide you with credit.

In a nutshell, your score can range from 300 to 850, and Experian is the only credit-reporting agency with the right to sell it.

With that being said, the other two credit reporting agencies (TransUnion and Equifax) may give your slightly different credit scores.

In my experience, your credit score is based on your payment history and the amount of outstanding debts you’ve accumulated.

If you pay on time and keep your balances low, then your credit score should be high.  However, if you find yourself on the short end of the stick and have run into financial trouble, you may not be so lucky.

As you think about the information you’ve learned in this article, it’s easy to see how the term FICA credit score could be confused with FICO credit score.

But now, you see the big picture and understand the difference.  But, don’t sweat it…so what you got off on the wrong foot.

You’re no longer in the hot seat.