Enjoying the show? Support our mission and help keep the content coming by buying us a coffee.Today, we're tackling something that hits every household: the concerning state of credit health in 2025. The data paints a stark picture: for the first time in over a decade, the US national average FICO score has dropped for two consecutive years, sitting now at 715. While a two-point drop may sound minimal, this is the fastest rate of decline since the 2009 recession, signaling significant economic strain on individual finances.We look at the two main forces driving this decline: soaring credit utilization and rising delinquencies.The average credit utilization rate (the percentage of available credit being used) has climbed to 35.5%. This figure is far above recommended levels and is hard evidence that high inflation and elevated interest rates are pushing households deeper into unsecured debt, including credit cards and personal loans. Delinquency rates for these products are hitting levels not seen since 2009.We also examine the group hit hardest: Gen Z. The data shows this generation saw the steepest average score drop—around three points—disproportionately affected by the end of the student loan forbearance period, which caused delinquencies to finally hit their credit reports in early 2025.Despite the macro pressures, we underscore the crucial foundation of credit health: Payment History. Making up a massive 35% of your FICO score, the single most important action you can take is to pay every bill on time, every time, even if it's just the minimum payment. We offer simple, high-impact safeguards like setting up automatic minimum payments or linking payment dates to your payday.Your Credit Utilization Ratio (CUR) accounts for 30% of your score, and it's where you can often see the quickest changes. While the general advice is to keep it below 30%, top-tier scorers often have utilization in the single digits. Here are 5 high-impact strategies to get your CUR down fast:The Mid-Cycle Payment Trick: Don't wait for the statement date. Pay down a chunk of your balance mid-cycle. Because most issuers report your balance on the statement closing date, the lower number will be reported to the bureaus, providing a quick score boost.Strategic Credit Limit Increase: Call your issuer and ask for a limit increase. If your balance stays the same but your limit goes up, your utilization percentage instantly drops. The immediate score benefit usually outweighs any small temporary dip from the inquiry.Keep Old, Unused Credit Cards Open: This preserves the length of your credit history and keeps your total available credit high, both of which positively impact your utilization and score.Become an Authorized User: If you have a reliable spouse or parent with a great, long credit history, ask them to add you as an authorized user on their account. Their positive history can reflect on your report, often providing a nice boost in just a month or two.Utilize Boosting Services: Explore tools like Experian Boost, which allow you to add positive payment history from non-traditional sources like on-time rent, utility, and streaming service payments to your file.Finally, we tie your personal finance health back to the wider economic picture. FICO's own analysts suggest that current delinquency patterns look less like an expanding economy and more like one that's in recession. We leave you with a potent question: Given this disconnect between the official macro picture and what's happening in individual households, how does it change your personal budget, savings, and risk tolerance for the year ahead?

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