Recently I pulled my credit score while shopping for a new (okay, an upgraded used) car – something newer than the 2008 Jeep Grand Cherokee I’ve been driving for years. I’m not panicked about tariffs, but I’ve read more than a few headlines warning of skyrocketing car prices. I like my Jeep, but I’ve noticed some decent prices on models 8 or even 10 years newer. So maybe now’s the right time to upgrade.
Anyway, when I pulled my credit score, it was surprisingly good. But as I thought more about it, I realized how incomplete the score really is when it comes to assessing your financial health. I kept seeing ads on TV hyping up ways to increase “buying power” — often just a fancy way of saying “more debt with a lower payment.”
And even if the tariff scare cools off and prices normalize, do I really want to risk a higher car payment than I can comfortably afford? What if another emergency pops up?
Here’s the thing: your credit score is a useful tool, but it doesn’t tell the full story. In fact, there are some very important aspects of your financial life that your credit score doesn’t reveal — and they could impact everything from how much house you can buy to whether you’re prepared for a layoff or medical emergency.
Let’s look at six things your credit score isn’t telling you (but should).
1. Your Credit Score Doesn’t Know Your Income
One of the biggest misconceptions about credit scores is that they reflect your income. They don’t. You could be making six figures and still have a poor credit score, or you could be living paycheck to paycheck and have an 800+ score.
That’s because your score is based on how you manage debt, not how much money you make. So when you walk into a dealership or apply for a mortgage, your credit score might look pristine, but if your income doesn’t support the payment, you can still be denied.
Tip: Always calculate your debt-to-income (DTI) ratio before making a big financial decision. Lenders certainly will.
2. It Ignores Your Emergency Savings
You could have a flawless payment history and still be one unexpected car repair away from financial trouble. Credit scores say nothing about how much cash you have saved.
That means two people with the same score could have vastly different levels of financial resilience. One might have six months of expenses saved, while the other is crossing fingers and hoping payday comes before the utility shutoff notice.
Tip: A healthy emergency fund can prevent you from taking on high-interest debt during a crisis. Prioritize saving even if it means slower debt payoff.
3. Rent and Utility Payments Usually Don’t Count
If you’ve been paying rent or utilities on time for years, good for you — but it likely hasn’t boosted your credit score. Traditional credit reports don’t include those payments unless you opt into services like Experian Boost.
That means a history of consistent, responsible payments might be invisible to lenders. Of course failing to pay on time or at all can nick your score so stay punctual.
Tip: Consider using a rent-reporting service or a program like Experian Boost to make your on-time payments count.
4. It Doesn’t Show Rising Expenses or Inflation
Your credit score might be stable, but if your grocery bills, insurance premiums, and gas costs are rising faster than your income, your real-world financial flexibility is shrinking.
This is especially important in the current economic environment, where tariffs and supply chain issues can quickly affect consumer prices (remember “eggflation”?).
Tip: Don’t rely solely on your score. Track your monthly spending and compare it to your take-home income. This gives you a clearer picture of your financial health.
5. Manual Underwriting Could Override Your Score
While credit scores are key in many automated lending decisions, some lenders still use manual underwriting — especially in mortgages and certain credit unions. That means they look at your whole financial picture: income, savings, job stability, and more.
You could have a mid-range score but still get approved because your financial habits show reliability. Conversely, a high score with no savings might raise red flags.
Tip: Keep good documentation of your income and assets. If you have a strong financial case, ask if manual underwriting is an option.
6. It Won’t Warn You About Lifestyle Creep
As your income rises, it’s tempting to increase your lifestyle accordingly — more subscriptions, bigger house, newer car. Your credit score won’t stop you.
In fact, as long as you keep making your payments on time, your score might go up, even as your financial security goes down.
Tip: Watch your spending habits and avoid inflating your lifestyle every time you get a raise. Long-term wealth comes from what you keep, not what you earn.
So What Should You Do?
Your credit score is just one piece of the puzzle. Before making big purchases or financial commitments, ask yourself:
- Do I have a reliable emergency fund?
- Is my income stable enough to support this loan if prices rise or things go wrong?
- Am I looking at the full cost of ownership (insurance, repairs, interest)?
If you’re buying a car, house, or even applying for a new credit card, use your score as a guide — but not as gospel.
And remember: even Warren Buffett keeps billions in cash to protect against unexpected downturns. He famously held over $100 billion in cash during periods of market volatility (currently $334 billion) and only buys when the value is obvious. He’s not relying on his “score.” He’s looking at the full picture.
Final Thought
The next time you check your credit score, treat it like a helpful snapshot — not a financial green light. What matters more is your ability to weather storms, make smart decisions, and grow your financial independence.
Because buying power isn’t about how much you can borrow. It’s about how confidently you can live without stress.
And if that means keeping the ol’ Jeep a bit longer? That might be the smartest move yet.
