I read the fine print on my car insurance statement. "You are not getting the best rate based on your credit history". ??? ...??? I called them to ask. This particular company uses a 12 point system. I came up short on 3.
1: "Age at first Credit" I didn't get my first credit card, charge card or car loan before age 21. Strike against me that is costing me extra for the rest of my life.
2: Not making current car loan payments. I always pay cash for my cars. Does borrowing money to buy a car make you a safer driver?
3: My lack of car loans in the past. I figure the higher insurance rates will be less than the interest and fees on car loans.
The insurance company didn't just use my credit score, they have their own more complicated system. I've read that your credit score can be used to determine loan rates for cars & homes.
I would suggest any one with kids, tell their kids to fill in one of those endless credit card apps they get as college freshmen with their book store purchases, buy a pair of shoes, pay it off right away, stash the card away. That could save them thousands over their adult lives.