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Credit Scores Likened to Your Board Scores

Jose Espada • 6/13/18

Credit Scores Likened to Your Board Scores

I recently read about credit scores though a blog re-posted from Future Proof MD, a radiology resident/future fellow who lives and works in Florida.  He compared how credit scores are likened to USLME Board Scores.  Having a perfect credit score of 850 affords almost no additional benefits over an otherwise high credit score of 760 or higher.  I would even argue that a 720 or higher gives you no additional benefits.  I would recommend reading Your Credit Score – Demystified so you are understanding of how your credit is measured.

We all know what board scores are and how important they are in defining your future aspirations in medicine.  A quick definition: board exams are a series of tests medical students beginning with USLME Step I (after the second year of medical school) followed by USMLE Step II (a part A and B during the fourth year of medical school) and finally, USMLE Step III (during the internship year of residency).  These exams test the appropriate level of competency to practice medicine.  So, how is your credit score much like your USMLE score, according to Future Proof?

  • Certainly, you want to pass your Steps, but a higher USMLE score opens more doors just like a higher credit score keeps the borrowing doors to lenders open in case you need money in the future for a car, a house, a practice, etc. A higher score provides the borrower with the best interest rates and provides other benefits, just as the bank’s confidence in your ability to repay the debt.
  • What does a high USLME score mean?  If you scored a perfect 290 on your USMLE Step I exam, you generally have put yourself in a position of strength when it comes to applying to specialty medicine (even the most competitive ones).  Of course, a medical student should choose their medical specialty carefully based on the amount of perceived future lifestyle happiness it will bring to them and their future family.  Similarly, while having a high credit score means that more lenders will be willing to loan you money at better terms, it does not mean you should start borrowing for anything and everything you want.  And if you do, it’s definitely the best way to bring your credit score down. Having too much credit goes into determining the credit score.
  • And it doesn’t predict the future.  The study habits and routines that you perfected in medical school to do well on the USMLE will have to continue to pass your specialty board certifications (once every 5 years). Physicians are required to maintain Continuing Medical Education credits.  This keeps them on target to stay up with what is going on in their profession.  Whether or not you believe in the 10,000 hour rule, like all skills, the name of the game is repetition.  What you learned but never use, you eventually lose.  Similarly, the good habits that earned you a high credit score – most importantly mindful borrowing and on time payments – will have to continue in order for you to reap the benefits of a high credit score.
  • It can be a status symbol, but beware your audience.  A “Board Licensed Physician” has prestige to it.  Although passing is all you have to achieve in your Physician Boards, bragging about your high scores is probably not socially acceptable.  But telling your parents, mentors, or friends & colleagues in another industry is perfectly okay.  Similarly, your credit score may mean a lot to your car dealer or mortgage officer but your colleague down the hall probably doesn’t care all that much about your credit score.
  • It may mean different things to different people.  Even when you know your audience, you have no control in how they perceive your USMLE score or your credit score.  For example, some programs directors pay extremely close attention to test scores while others may emphasize your letters of recommendation or your extracurriculars.  Similarly, different lenders may weigh different components of your credit score differently.

It is proven fact that if you approach your credit with the same level of care, seriousness and hard work you give to the USMLEs, you will undoubtedly find long lines of lenders vying for your business in the future.  This often affords you the opportunity to get the best deal with regards to the terms and conditions of the loan or transaction.

There are many free options to keep tabs on your credit.  There are free apps that I recommend, Credit Karma, Credit Sesame or Wallethub to name a few.  Although, these apps don’t necessarily give you your exact score, they are able to give you a good indication of where you are with your credit and they offer ways for your improve your credit.

Author

Jose Espada

Jose Rivera Espada is the director of financial aid at IU School of Medicine, a nine-campus allopathic medical school in Indiana. Jose’s experience includes working as an assistant director of financial aid at Butler University and a financial aid counselor at Indiana University in Bloomington. He has served on various committees at the Association of American Medical Colleges (AAMC) as well as state and regional financial aid organizations. He speaks regularly about financing medical education at colleges and universities throughout the state of Indiana. He earned an undergraduate degree from Indiana University and worked toward a master’s degree in music education before finding financial aid as a profession. He performs regularly with small professional choral ensembles in the Indianapolis area.