CREDIT STRENGTH SERIES
Why Good Credit is a Competitive Advantage
Steve had the drive, the numbers, and the window of opportunity.
A national team spot was within reach—but only if he could get closer to the gym and train full-time.
He found a place within walking distance.
Affordable, quiet, no distractions. It was perfect.
The landlord handed him the rental application and said:
“We just need to run your credit and get back to you.”
Two days later—denied.
Steve didn’t have credit—and that was enough to slam the door shut.
In the game of life, good credit isn’t optional—it’s your competitive advantage.
Why Financial Literacy Shapes Your Whole Life
Understanding credit isn’t just for adults buying houses or applying for business loans—it impacts nearly every corner of your life.
- Where you live – Landlords check credit to decide if you’re a risk.
- What you drive – Auto loans, leases, and even your insurance rate can change based on your score.
- Your job – Some employers run credit checks to assess responsibility and trustworthiness. (here’s how it works).
- What you pay – A lower score can mean higher interest rates, bigger deposits, and worse terms—even if you qualify.
And it’s not just about being approved. Good credit saves you money, gives you options, and lets you act fast when opportunity knocks—whether that’s financing a trip, starting a business, or helping your family.
If you wait until you “need it,” it’s already too late. Building credit takes time—and that clock starts ticking the day you take it seriously.
Credit = Trust
When a landlord or employer pulls your credit file, they’re not just looking at numbers—they’re looking at trust.
Can you be trusted to take care of their property?
Will you take the job seriously?
Plenty of companies—especially when you’re just starting out—want to know if you’re a good risk.
And your credit report is the primary way they find out.
Character references might help, but think of this as the ultimate character reference.
Even cell phone companies use credit to decide if and how much of a deposit you’ll need.
Same goes for utility companies when it’s time to get electric, gas, water, or cable turned on.
If your credit is poor—or nonexistent—a big deposit might be required.
Sometimes as much as six months’ worth in advance.
Now imagine you’re trying to get your own place.
You already need first month’s rent, tack on an additional three-month security deposit, plus hundreds more for utility deposits.
That can stop you in your tracks.
But when your credit is solid?
You might skip those deposits altogether—keeping your savings intact and giving yourself financial breathing room to move forward.
Why Credit Is a Competitive Advantage in Real Life
When buying a car, one of the smartest moves you can make is calling your insurance agent before signing the paperwork.
During my time running finance at a dealership, this happened constantly—people spent all day negotiating their car payment down to the dollar… only to be blindsided the next day when their insurance cost was just as much—or more than the payment itself.
That’s when I saw firsthand how credit is a competitive advantage many overlook. Sadly—it wasn’t rare.
Insurance Companies Judge Your Credit — Not Just Your Driving Record
Big-name companies like Allstate, Geico, and State Farm, sort customers by risk.
You could have a spotless driving record—no tickets, no accidents—and still get slammed with sky-high premiums. Why? Because insurance companies don’t just look at how you drive.
To them, bad credit = high risk—just like reckless driving.
They don’t use your FICO score directly, but they do pull similar data to calculate a credit-based insurance score—and a strong one can save you hundreds, even thousands, over time.
Perks of Good Credit: Why the Numbers Matter
Let’s say your monthly budget for a car and insurance is locked at $500.
Whether that gets you a beat-up beater or a newer, reliable vehicle depends entirely on your credit.
With good credit, you get rewarded with lower interest rates and cheaper insurance premiums.
With poor (or no) credit, the system sees you as a risk—and prices you accordingly.
Here’s how that plays out in real life:
Example: Car Buying with Good vs. Poor Credit
$500 Monthly Budget Breakdown for your car and insurance combined.
| Good Credit | Poor Credit | |
|---|---|---|
| APR (Loan Interest Rate) | 4% | 15% |
| Insurance Premium | $100/month | $200/month |
| Budget Left for Car | $400/month | $300/month |
| Car Type | Newer, more reliable, possibly under warranty | Older, higher mileage, fewer features |
| Overall Impact | More value, lower stress, better reliability | Higher cost for less, more risk |
Same $500/month. Totally different outcome.
Good credit = better terms = better car.
It’s not just about saving money—it’s about getting more for what you’re already spending.
Using Credit as Leverage
Credit is about leverage.
It lets you use someone else’s money without giving up your own—so you can act fast, stay liquid, and keep your momentum.
It’s NOT about spending recklessly.
It’s about strategic timing and smart positioning—just like a well-timed lift.
Here’s what real leverage looks like:
How Jim Used Credit to Level Up
Jim had been renting a condo for five years. Solid spot, decent rent, and it worked for his lifestyle.
Then his landlord dropped the news:
“I’m retiring, and I’m selling the place.”
Jim had two choices: pack up and move—or buy it himself.
Thanks to his solid credit, he qualified for a low-interest mortgage with minimal down payment.
In the end, his new mortgage payment was actually lower than what he was paying in rent.
Out of pocket? Just a few thousand dollars.
Six years later, that same condo is worth twice what he paid.
If he sold today, he’d walk away with enough profit to cover all his mortgage payments—and even recoup most of the rent he paid in the years before buying.
That’s leverage.
He used the bank’s money to build equity, pay less each month, and keep his own cash intact.
And there’s more: as a homeowner, Jim now deducts his mortgage interest and property taxes on his income taxes.
That’s money renters never get back.
Good credit gave Jim leverage. Leverage gave him ownership. And ownership gave him options.
Secured vs. Unsecured Debt: Know What You’re Using
To build credit wisely, you need to understand the two main types of debt.
- Secured Debt = Backed by something the lender can take if you don’t pay.
Examples: Mortgage, auto loan, secured credit card (your money acts as collateral). - Unsecured Debt = Isn’t backed by anything. It relies solely on your creditworthiness and payment history.
Examples: Most credit cards, personal loans, student loans.
Why It Matters
- Secured debt often has lower interest rates.
- Unsecured debt is riskier for lenders, so it’s more expensive.
Installment vs. Revolving Credit
In addition to how debt is backed, there’s also how it’s paid back—and that matters too. There are two main structures:
- Installment Credit – You borrow a fixed amount and repay it in equal, scheduled monthly payments over a set period of time. Both the payment and the term are locked in once the loan is funded—this protects both the lender and the borrower.
Examples: car loans, student loans, home loans - Revolving Credit – You get approved for a set credit limit, and you can borrow, repay, and reuse it as needed.
Examples: credit cards, store cards, lines of credit
Understanding how each type works helps you manage them better—and sets you up to build credit the smart way. We’ll walk through exactly how in the next post. (Here’s an overview from Experian).
Clearing the Noise: Credit Isn’t the Enemy—Irresponsibility Is
Some popular voices—including loud ones like Dave Ramsey—say, “Never use credit.” But that message assumes you can’t control yourself.
Athletes live with discipline every day—in training, nutrition, mindset, and recovery. You don’t need to fear credit. You just need to use it with the same intention and structure that you bring to your sport.
Used recklessly, credit can hurt you.
Used wisely, it becomes a powerful and profitable asset.
That’s why athletes are uniquely equipped to use credit the right way.
Mindset Comparison
| Fear-Based View | Empowered Athlete View |
|---|---|
| Avoid credit completely | Use credit strategically |
| Assume people can’t control spending | Build discipline through awareness |
| Save cash for everything | Use other people’s money when it benefits you |
Ramsey also argues that having a high credit score is a bad thing, claiming it only proves you’ve stayed in debt. He famously said:
“The only way to have a good credit score is to go into debt, stay in debt, and continually pay your debts… A high credit score does NOT equal success.”
That’s his view. But here’s the problem: he assumes you’re reckless.
He assumes you’ll swipe your way into a hole and never climb out.
That advice also ignores reality.
The average home in the U.S. now costs over $400,000, and the average new car is pushing $48,000. Meanwhile, most people under 35 have less than $6,500 in savings.
Waiting to pay cash for a house or car sounds noble—but for most, it’s not realistic. Even Ramsey himself acknowledges that you’ll still need somewhere to live.
And when it comes to housing, let’s be real: You’re always going to pay to live somewhere—whether it’s a mortgage, rent, or a trailer park lot fee.
Even if you “own it outright,” there’s property tax, insurance, and upkeep. You never stop paying to live.
So the question isn’t whether you’ll pay—it’s whether you’ll build equity while doing it.
Renters pay forever and walk away with nothing. Owners build wealth over time—and that starts with credit.
If you’re using weights to build physical strength, this is no different. Using credit with discipline builds your financial strength.
It’s not about loving debt—it’s about staying in control, making smart moves, and setting yourself up for long-term success.
That’s what this series is all about: Credit Strength.
Up Next in the Credit Strength Series:
The Time To Start is Now!
In the next article, I’ll walk you through exactly how to begin—from entry-level moves to expert tactics that actually build your score.
Plus, I’ll expose the most common traps people fall for… so you don’t waste time thinking you’re building credit—when you’re actually getting played.
