These two resources (audio and an article) caught my attention over the past week as they provide different perspectives on credit scores. The 3 minute audio from Marketplace (below) describes the history of credit scores in the U.S. and how they have evolved over time while the NY Times provides a plain English Q&A on the topic.

Audio from Marketplace (3:28):

A credit score is the calculated probability of how likely you are to pay debts. But it affects where you live, what car you can buy and even whether or not you can get a job. Josh Lauer is a professor of media studies at the University of New Hampshire. His new book, “Creditworthy: A History of Consumer Surveillance and Financial Identity in America,” looks at the long history of the credit industry in the United States. He talked with Marketplace host Kai Ryssdal about how that industry has changed over time. The following is an edited transcript of their conversation.

Primer from NY Times “What You Should Know About Credit Scores,” has a simple Q&A format and describes credit scores in plain English (it helps that it is in the Simple Living column):

When I applied for my first credit card after college, I felt ready to take a big step in my life. Most of the people I knew used credit cards to pay for things — expensive, liberating things like laptops and airplane tickets. And as a freshly minted college graduate, I was excited to be able to buy those things with a credit card.

But when I walked into the local branch of a national bank, my credit card application was denied. The banker helping me cited my lack of a credit score as the main reason for my denial and I looked at her dumbfounded; I had no idea what a credit score was.

It turns out, I was not alone. About 45 million Americans do not possess “traditional” credit scores.

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Check out NGPF’s Case Study “Tale of Two Credit Scores” in which students take on the role of credit counselor and have to devise strategies to help two young people struggling with this concept.

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.