QoD: You're new to credit and you don't pay your credit card bill for months. It gets sent to a collections agency. How much will your credit score decline?

Jan 08, 2020
Credit Scores, Question of the Day, Credit Cards

Answer: 224 points (from 599 to 375)

Explanation: Your score sank 224 points. A credit card in collections means your credit score is now in the high-300s. 


  • Why do you think not paying your credit card bill for months has such a big impact on someone who is new to credit?
  • What do you think are the reasons that people can’t pay their credit card bills? Identify at least 3 reasons.
  • What are strategies you can come up with to make sure that you are always in a position to pay off your credit card bill every month?
  • Why do you think that credit card companies refuse to lend to anyone with a 375 credit score?

Here's the ready-to-go slides for this Question of the Day that you can use in your classroom.

Behind the numbers (WSJ Credit Score Game; sub. required):

The financial decisions we make every day impact our credit scores, which help lenders decide whether to give us credit cards, auto loans and mortgages—and how much those loans will cost us. Some moves hurt, some moves help. Let's see how good you are at predicting the outcome.


Want to know how other actions impact your credit score? We have 6 more questions just like this one embedded in this activity: How will this affect my credit score? 


Here are two teacher Faves when it comes to credit scores: Interactive: FICO Credit Scores and CALCULATE: Impact of Credit Score on Loans

About the Author

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.