Many have an unhelpful and unnecessary fear surrounding their credit score, known as pistotikophobia; here is what it is and how to treat it.
Phobias are common. Fear of heights, fear of the dark, fear of flying.
But there is one fear that doesn’t get enough discussion out there. And I am all about raising awareness about areas that affect our mental health.
So I want to put the call out there and shake off the stigma and the taboo.
It’s time to talk about: fear of your credit score.
Table of Contents
What it is
Fear of your credit score, or pistotikophobia (from the Greek word πίστωση or písto̱si̱ meaning “credit”), is the irrational fear in the power of one’s own credit score to affect one’s life.
This fear can cause people to behave in strange and counter-productive ways, such as:
- Using credit cards unnecessarily
- Checking your credit score compulsively (including, but not limited to, installing apps on your phone to monitor it)
- Making purchasing choices partially or primarily with your credit score in mind
- Worrying about your credit score (for any amount of time)
If you or someone you know has more than one of these symptoms, you or they may be suffering from pistotikophobia.
Why this matters
Understanding this phobia matters, because credit scores don’t.
Okay, that’s not entirely true. Credit scores matter to a certain extent, but not nearly as much as you might think.
For instance, if you’re not doing things like applying for a credit card or loan, looking to rent an apartment, or going for a new job, then there is no reason why your credit score will affect any aspect of your life.
(Higher interest rates on debt are a concern when your credit score is lower, but just raising your credit score won’t magically change your interest rates.)
For most of us, we spend most of our lives not doing any of the above, which means that for most of our lives, our credit scores do not impact our lives in any measurable way.
And that list above is probably larger than necessary. Not all jobs or rental agencies run your credit score, and it is definitely possible to get a mortgage without a credit score.
So if you suffer from a fear of your credit score, then you are, most likely, worrying about it unnecessarily.
What’s not important
Credit scores rise and fall all the time, so checking your credit score any more than once every few months is not productive.
It’s just like your retirement accounts. There is absolutely no reason to check them more than a few times a year. No short term change is significant. What you care about is the trend line.
And the more you look, the more likely you’re going to do something you regret!
(Know someone who got out of the market once the pandemic hit? Well, the S&P 500 is up about 30% since then. Just saying.)
Likewise, putting all your spending on a credit card is unnecessary. If it were necessary, then I’d be totally screwed. (Here are the times when I use a credit card.)
If you want to keep some activity on your accounts, put a medium-sized purchase on the account once in a blue moon, and then pay it off. That’s all.
What is important
Now, don’t get me wrong, it’s not a terrible idea to know your credit score. After all, it can be indicative of things you may not be aware of, such as:
- Unpaid debts you didn’t know you had
- Errors on your credit report
- Identity theft
All of these things are important to know about, and fix.
But if there’s one thing I’ve learned from years of having a credit score it’s this: If you practice good financial stewardship, your credit score will take care of itself.
This means things like paying your bills on time every month, paying your taxes on time every year, eliminating errors on your credit report, and paying off balances when you have them.
(And not that it matters, but my FICO score and VantageScore have both been consistently north of 800 for at least the past decade.)
How to manage it
The first thing to do is to recognize it when it’s happening. How much do you worry about your credit score?
Next, we need to get to the heart of what it is that you’re worried about. Is there something you’re wishing that you could do that you can’t, or is this a fear instilled in you by a debt processing company that just wants your money?
Then, we need to establish that this is a credit score, not a life score. This is not a reflection on you. If your credit score is low, it doesn’t mean that you’re a bad person. Low credit scores are okay.
Remember, unless you’re actively pursuing a credit checking event, which most of us aren’t, it doesn’t matter what your score is! You can be a good person with a low credit score.
Once we can separate your feelings about yourself from your feelings about your credit score, you’re on the way to a more healthy relationship with money, as well as being free from pistotikophobia.
Let’s raise awareness
While you may want to write off this whole discussion as frivolous, it’s not. You may not have heard of pistotikophobia, but it’s certainly real. I’ve worked with plenty of clients who base their financial lives around what they think will improve their credit score, and then compulsively track its changes.
This doesn’t serve anyone at all, except maybe the credit companies.
That’s why, on this occasion, I want to raise awareness about pistotikophobia. Together, we can eradicate this unnecessary scourge on people’s mental and financial health.
If you’re worried about your credit score, send me a note and tell me what you’re worried about. I bet I can help.
