Why Ditching Your Credit Score Entirely Could Backfire on Your Finances

You might have heard some high-profile personal finance influencers argue that having a 0 credit score is somehow liberating—a way to stick it to “the debt system.” But here’s the reality check: abandoning your credit score entirely is a decision that could cost you thousands of dollars and create unnecessary friction in your daily life.

The Real Cost: Housing, Insurance, and Beyond

Let’s start with the most obvious hit to your wallet. When you apply for a mortgage, lenders don’t just look at your income and savings. They pull your credit score to set your interest rate. The difference? A borrower with excellent credit might secure a rate that’s significantly lower than someone with poor or no credit history. Without a credit score, you’re not just limited in options—you’re also likely paying a premium.

The mortgage industry makes this clear: lenders offering manual underwriting (the workaround for borrowers without credit scores) are increasingly rare. You’d need to gather 12 to 24 months of bank statements and payment documentation, visit a handful of specialized lenders, and hope one accepts you. That’s a lot of friction for something that could be resolved in minutes with a solid credit profile.

Renting is equally frustrating. Property managers routinely screen applicants using credit scores. In competitive markets, a landlord with multiple applications will simply skip over anyone without one—regardless of how reliable you are otherwise.

Beyond housing, the consequences multiply:

Insurance premiums skyrocket. In 47 states, insurers can factor your credit history into auto insurance rates. The gap is stark: drivers with excellent credit pay roughly 50-60% less than those with poor credit. With a 0 credit score, you’re looking at the highest tier.

Utility deposits become standard. Water, electricity, and gas companies treat customers without credit histories as high-risk. Instead of a simple sign-up, you’ll pay deposits upfront—potentially hundreds of dollars across multiple services.

Borrowing becomes nearly impossible. What happens when you face an emergency expense that exceeds your savings? Without a credit score, accessing a personal loan or a 0% APR promotional offer isn’t even an option. You’re entirely dependent on cash reserves.

The Misconception About Building Credit

Here’s what gets lost in the “abandon credit scores” rhetoric: you don’t need to go into debt to build credit. The path is straightforward:

Get a credit card. Use it for recurring purchases. Pay the full balance monthly. That’s it. You’re building credit history without paying a dime in interest. Even charging one $10 coffee per month and paying it off demonstrates responsible borrowing behavior to credit bureaus.

A credit score simply measures your likelihood of repaying borrowed money. It’s not a morality judgment. It’s a tool that, when used correctly, opens doors.

Who Can Actually Afford No Credit Score?

The advice to pursue a 0 credit score works if you have substantial wealth, multiple properties purchased in cash, and the flexibility to shop for obscure lenders who still offer manual underwriting. For most people, though, this approach creates problems that didn’t need to exist.

A credit score takes minimal effort to maintain and maximum effort to recover from if you destroy it. The smart play isn’t elimination—it’s smart management. Build it, maintain it, and keep your options wide open.