Question of the Day: What Is The Cost Of Having Bad Credit?

Oct 31, 2014
Credit Scores, Question of the Day, Personal Finance

Yesterday, I tackled the issue of how long negative items remain on your credit report.  Today, courtesy of, we have an answer to the question of how much bad credit will cost you over a lifetime.  We know that a poor credit history (which translates into a low credit score) will make it difficult to borrow as many lenders will deny applicants if they don’t meet their standards.  For those with poor credit, who are able to borrow, there is a premium that they pay which is a higher interest rate and also perhaps higher fees.

So, over a lifetime, how much  more will someone with a lower credit score pay….drumroll please?

About $160,000.  So not paying that traffic ticket or not paying your bills on time has a real consequence!

“According to, somebody with top-notch credit would pay $209,590 in interest, while people with bad credit would be on the hook for $369,054, on average.”

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.

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