About two months I experienced a rather rude financial awakening. My massive debt aversion over the last 24 years (well, I doubt I cared much as a child so let’s say 13 years) resulted in a lack of credit history. My one credit card I’d been using since 2007 simply wasn’t providing enough history. This fun fact was unearthed when I used the much-raved-about Credit Karma to try and get my free FICO score. Credit Karma accepted all my information to promptly explain I had a “thin file” which meant they could not produce a score. They were kind enough to suggest ways I might improve upon my failings which basically were just to use debt tools (ie: loans and credit cards) to increase my credit history.
Always eager to improve myself, I immediately began figuring out how I might go about having a “thick file.”
Taking out a loan for the sake of taking out a loan seemed dumb so I decided to try opening another credit card. I’d long been the delighted recipient of credit card offers in the mail which always ended up in the trash. Now, I started to actually read the offers and narrowed my search down to a Capital One card or the Discover it card.
While Capital One does offer better slightly better cash back (1.5% on everything while Discover is 1% with rotating categories for 5%) the Discover it card promises of a free FICO score, no annual fee and non-outsourced customer service won my heart. Plus, I think their commercials are funny (but Capital One did have Alec Baldwin…I’m a marketer’s dream…)
The free FICO score was important because the Credit Karma and Credit Sesame products of the world don’t work for me. Funnily enough, both Discover and Credit Karma pull their data from TransUnion (one of the three major credit bureaus) to produce their scores. I just don’t flag for Credit Karma… It should also be noted that by having a FICO score from only one of the three credit bureaus you aren’t seeing the full-picture of your credit score because you may have a different number at each bureau. To truly know your score you’d have to get reports from all three bureaus, but this single report way will still give you a good approximation.
If you’re interested in opening a Discover it card, either because of the FICO score or hilarious commercials, here is my assessment after about two months of using one:
Free FICO score (obviously)
I don’t need to expand more, but I like having the access to my score each month so I can monitor for major fluctuations. However, this shouldn’t replace proactively checking credit history reports, which don’t provide a score but are free once a year, with TransUnion, Experian and Equifax to monitor for any red flags.
Customer service calls aren’t outsourced and are pleasant
I’ve only had to call once — to set up the card — but I do appreciate that the calls are in the US. Yay for helping improve employment and apparently with friendly people because my call was very pleasant. This might have to get revised if I ever need to phone in a complaint.
Widely accepted by merchants/retailers
My first credit card is a MasterCard and I’ve never had it get rejected, but I’d seen friends get their American Express cards turned away so I wanted to ensure my second card would be widely accepted. Thus far, I’ve only encountered one restaurant that didn’t take Discover out of the various locations I’ve used the card.
You get 1% on all purchases with a rotating 5% cash back in various categories. Plus, you get a $50 kickback the first time you make a purchase within 3 months of opening the card.
In a shameless plug, I ask that you scratch my back a bit if you plan to get the Discover it card and use my referral link (here) so I get a “finder’s fee” if you will.
Least Favorite Features:
Have to enroll to get the 5% cash back
While it’s really simple to opt in, and they send you email reminders, it irks me that this isn’t automatic (and yeah it’s to save the company money on those who don’t take the 17 seconds to sign up).
Cash back categories don’t always apply to me
The first quarter of 2014 I was able to really utilize cash back because it was on movies and restaurants. I usually go out to eat once a week (hello brunch) and I’ll treat myself to an overpriced movie ticket on occasion. Unfortunately, the cash back category for the second quarter is on home improvement stores, furniture stores and Bed Bath & Beyond. Ehh. My mom would love this category but I don’t have any big plans to be utilizing those stores in the near future, unless my landlord lets me paint the apartment…
What ways have you gotten a FICO score for free?
Special thanks this week to….
Average Joe from Stack Benjamins for having me back in the basement. Greg (from Control Your Cash) and I rip into a silly article about how to savor saving on this week’s Stacking Benjamins podcast.
J. Money from Budgets Are Sexy for mentioning my post “An Impassioned Plea for Understanding Compound Interest” as inspiration for his own story on the 8th wonder of the world. Thanks to Economag for reprinting it recently which prompted J. Money to see that hidden gem from last June.
Cat from Budget Blonde for mentioning me in a stellar lineup of lady bloggers in her edition of Women Power Wednesday.
Shannon from Financially Blonde for saying our chat over a couple of brews inspired her to write this great post about getting over investing fears! And a belated thanks to her for including me in her Women Power Wednesday and for coming up with the whole idea in the first place!
[Discover it image from Flickr]
23 responses to “Frugal Find Friday: How I Get a Free FICO Score”
Haha I actually just checked my credit score last night by logging into Discover. I love Discover!
I’ve been a fan so far! Hopefully it will stay that way.
Thanks for the shout out Erin! I am a marketers dream, and honestly the Capital One commercials during March Madness last year with Alec Baldwin and Charles Barkley made me really want to open a Capital One account. This Discover commercial is awesome, though, I love it when men scream like girls. 🙂
Snappy commercials certainly peak my interest!! And the girly shriek is just icing on the cake.
What’s a FICO score? and whats it for. Your personal finance blog about credit card is very informative and has a nice concise comparison between its features. Going to read the features of my MasterCard later.
Thanks for pointing out the FICO score point, Jeff. Sometimes I take for granted that it’s already been discussed on this blog before so newer readers (like yourself) may not have seen those posts. I’ve hyper linked the reference to a prior post about the breakdown of a credit score.
Once a year, I get a free credit report (including all three bureaus) at https://www.annualcreditreport.com/index.action.
It’s the easiest, safest way to obtain a free credit report. You get one free credit report per year (and why would you need more?).
All the other ‘free credit sites’ seem to sketchy to me. Their ads on TV just ooze with slime.
Like I wrote in the post, I recommend everyone doing that but a free credit report doesn’t provide you with a score. You’re still going to have to pony up the money if you want to see your score. You should absolutely be monitoring your report for any red flags, but if you need to know your score — for say a loan or renting an apartment — then it’s nice to know.
Yes, you definitely have to be careful about the credit monitoring services. I had Credit Sesame for a while, and it reported that I had a wonderfully high credit score–like a 750 or better. However, when I went to get a mortgage, one of the bureaus reported I had a score of 680!
I had checked my credit report prior to applying for the mortgage, there were no errors on my report, no late payments, everything was beautiful, so I thought I didn’t need to pay for my credit score.
I was so, so wrong.
I’m not going to open a credit card just to see my credit score (although I don’t knock you for doing it since you’re desiring to “bulk up” your history). I will, however, gladly pay for it (from ALL bureaus!) if I ever need to open a big line of credit.
I wouldn’t get a credit card simply for the sake of the credit score either. It’s just a great added perk. It’s a bummer credit sesame scored you so high and resulted in you being surprised in a somewhat vulnerable moment — it’s one reason I take my Discover score with a grain of salt. I’d certainly pay for my reported score from all 3 bureaus if I were going into negotiate a mortgage or get some other loan.
I had a regular Discover card but asked to be converted to the Discover It card. The free FICO score was definitely one reason, the other was the 1% (the old card was tiered). Other cool things about Discover are the rewards…can get a $25 Staples gift card for $20 worth of points…well that’s the one I like the most, but there are many other choices. Some are $40 gift cards for $20. And I also like their shopping portal…if I’m gonna buy something online, might as well go through their portal to earn some extra points.
As a new member I haven’t had a chance to really play around with their rewards models yet so those are some great tips. Thanks, Andrew!
The Discover It commercials are pretty hilarious. I’m pretty almost everyone in the States is a marketers dreams. 🙂 I think Discover is much more widely accepted than they used to be. For awhile, there were more places that didn’t accept them, which is a pain as I am quite loyal to my American Express card. Have a great weekend, Erin!
I just got an AMEX card with a Delta card and it’s annoying that places don’t accept it. But in NYC there are plenty of places that also want cash only, mostly smaller brunch/dinner joints. I do feel the need to keep my MasterCard in my wallet though.
A lot of cards have that 5% rotating cash back and so often they don’t apply to me either. Gas and movie theatres aren’t gonna do much for me.
I probably go to movie theaters once a quarter and obviously no need for gas either! I have a few friends who really love both those 5% cash back options though. It is pretty awesome if you have a car and need the gas.
An easy way to get your credit score is to ask for a ridiculously high credit limit on your credit card, or ask for an increase on a card you haven’t had for very long.
When you get denied, they include an official FICO credit score from one of the bureaus in a letter to you. It should be a soft inquiry as well, so no negative effects on your score.
That’s an interesting financial hack I’d never heard. Thanks for the heads up!
I had a discover card for a while, it served its purpose. I heard the podcast over at Stacking Benjamin’s, very funny podcast. I laughed at the banter between all three of you on segment you were featured on.
Thanks very much. Glad to have made you laugh!
A great no-fee card that I recommend is the BarclayCard Rewards card. They also do the free score bit too but they’re a British based bank with a huge international presence so they don’t fit that American standard of Discover. I do like Discover too, although I have an older Discover card I don’t use much lately.
If you ever want to try out a fee-based card, my personal favorite is the Chase Sapphire Preferred. I don’t eat out much but have been doing so more frequently as of late since I’ve been doing dining mystery shops and that card gives double points on dining which is pretty awesome.
I signed up for this card a few months ago and got my wife signed up last month. It was my first discover card so it was kind of exciting. It’s nice to be able to check our FICO scores whenever we want. It also had a pretty good sign up bonus of $150.
This one’s a keeper.
Pro tip: Discover cards are pretty much useless outside the US of A. They’re taken a few places, but not many. Obviously not a problem for you 99% of the time, but something to keep in mind if you go on a big trip.