How the Three Major Credit Bureaus Compare

Ever wonder where your credit report comes from? The answer is simple: the credit bureaus. Equifax, Experian and TransUnion represent the three largest consumer credit reporting agencies in the U.S.

All three bureaus collect information about your financial accounts and use them to generate your credit report. The information in your report is then used to calculate your credit score, the three-digit number lenders use to make credit decisions.

But, your credit score with one bureau may not be the same as the other two. That’s because the three credit bureaus don’t always use the same information to create your credit report.

 

How credit reporting works

Equifax, Experian and TransUnion all rely on your creditors to report information about your financial accounts. That includes things like:

  • Your payment history
  • Account balances
  • Credit limits
  • Inquiries for new credit
  • Types of credit you’re using
  • Age of your credit accounts

These factors are what’s used to tally up your credit score. The credit bureaus also collect non-financial information, including your name, Social Security number, birth date, address history and employment history.

 

Why your Equifax, Experian and TransUnion credit reports may differ

While all three credit bureaus can track the same information, they’re not responsible for actually reporting it–your creditors are. For example, if you have a major credit card like the Platinum Card® from American Express, that account would likely show up on all three reports. But, if you have a personal loan with your local bank, they may only report it to one of the bureaus. Some credit accounts are never reported at all. There’s no requirement that creditors do so; the process is completely voluntary.

The credit bureaus can also differ with regard to things like how your employment data is reported. Equifax and Experian may just list your employer’s name while TransUnion may list your employer’s name, your position and your dates of employment. Keep in mind, however, that your employment history has no impact whatsoever on your credit score.

Differences in what’s included in your credit report concerning your credit accounts can directly impact your credit score. Your Experian credit score could be higher than your TransUnion or Equifax scores, for instance, if you have a positive payment history with a creditor that’s reporting only to that bureau.

 

Checking your credit reports

If you’ve never checked your credit before, it’s a good idea to consider reviewing your report from all three credit bureaus. That way, you can see where they overlap and where they differ in terms of what’s being reported and how that may impact your credit score. You can get one free copy of each bureau’s credit report per year through AnnualCreditReport.com.

As you check your report, also be on the lookout for any errors. If you successfully dispute an error, the credit bureau that reports it is required to remove or correct this information. And finally, remember to scan your report for accounts you don’t recognize, which could be a sign of identity theft.

How Society can Affect Your Net Worth.

The song “No man is an island, no man stands alone” says it all, even down to how much wealth we might accumulate in our lifetimes.

Society affects each of us – what we give and get from others. Others affect us.

How can society affect our net worth?

We want to fit in.

For the human condition, there is safety in numbers. Our remote ancestors found this to be true when fighting off the beasts and we still see and feel the need to be part of a group. Often times, we benefit from being part of a group.

The first group we are part of is usually a family. Families influence us immensely. Each family grouping has unique expectations.

Some families traditionally work for others for a living and therefore expect us to do so as well. Some families start their own business and are disappointed if their children don’t start one too. Some families expect kids to drop out of school and earn money for the family. Other families encourage kids to go to college and be a professional. Each of these could affect our ability to generate wealth and grow our net worth.

We tend to rise (or fall) to the level of expectations set – to fit in, to avoid disapproval. If you are expected to go to school, learn well and earn good grades, you are more likely to do so than the child who is ridiculed for being a ‘geek’.

We model our behavior by watching those around us.

Kids learn so much more by observing than they do through lessons. If your parents were savers, you probably are a saver as well. If your work associates discuss investing, you may be more prone to think about putting money in the market. You do what you know.

Wanting to fit in can influence your ability to generate wealth.

Perhaps you feel like you must go to the bar, out to lunch, shopping with the girls, to the game to the greens and etc to join in with the group. Joining the group at times can be very advantageous, but joining in every time can limit your opportunity to accumulate wealth.

We compare ourselves to others and compete.

The things that we want from life are influenced by those we see around us. We consciously and subconsciously are always comparing ourselves and our possessions to what others have. We judge our relative value through these comparisons – even though we shouldn’t.

Sometimes we feel we have to spend money to obtain what we perceive as a comparable level of wealth. Keeping up with the Jones can be a wealth drainer.

For example, when we work in a professional field (like surgeons), we may feel we have to maintain the ‘right’ image by living in a certain neighborhood, driving a certain kind of car, dressing a certain way, belonging to the right club and etc. Maintaining this image can be a wealth drainer.

We rely on others.

Others may provide or withdraw opportunities than could help us get wealthy.

The boss might decide to challenge you by giving you a big opportunity. If you succeed, that opportunity might lead to bigger and better things. Likewise, the boss could hold you back by denying opportunities or refusing to acknowledge your skills or shunting you off onto a sideline that has no advancement potential.

Words CAN hurt your ability to accumulate.

I believe it is much easier to do great things when you receive support and encouragement from those around you. Ridicule can quickly kill your desire to achieve.

If your spouse makes fun of your thriftiness, or down plays your ability to start that super star business, you will be tempted to just drop the idea. If she yells at you when you spend money on certain things. or he gets mad if the checkbook isn’t subtracted out right away you may retaliate or you may avoid doing those things in the future. The ways you interact with others about money can influence your ability to be wealthy.

Early experiences with money issues can have a life long affect. If your parents punish you for spending or reward you for saving, it can have an emotional impact years into the future – and not necessarily the one your parents intended.

What has society done to alter your net worth?