The company behind the FICO score makes it easy for you to learn your credit score online, but a handful of alternatives threaten to make the process more confusing.
Unlike free credit reports, which federal law requires the three major credit bureaus to send you at your request each year, credit scores cost money. That's because each credit scoring system uses a secret algorithm to turn your credit report into a three digit score or a letter grade.
You can always see your FICO score for a one-time fee of about $20, by visiting myFICO.com. Skip the confusing and sometimes misleading buttons that scream "free credit score," and click the tab marked "FICO Scores & Credit Reports." If you think you'll want to check your score more often, you can subscribe to a quarterly monitoring program that costs $60 per year.
A few services charge $10 to $20 per month to alert you when your credit scores change. However, by most accounts, your credit score won't exhibit huge swings during the course of a year. Unless you're right on the cusp of closing a deal for a mortgage or auto loan, you won't really need to monitor changes in your score more than quarterly, anyway.
Instead, I often recommend a frugal habit inspired by talk radio host Clark Howard. He suggests spreading out your requests for free credit reports from AnnualCreditReport.com. For instance, instead of viewing all three credit reports at once, you might request Equifax in January, Experian in May, and TransUnion in September. That way, you can see changes to your credit profiles over time without having to pay for a credit monitoring program.
On the other hand, if you've been battling identity theft or bank errors, you may want to lump the cost of a more proactive credit alert system. Be careful if you choose a service that places "freeze" requests on your credit profiles, since you could unwittingly prevent yourself from changing credit card companies, upgrading your cell phone, or signing up for a new insurance provider. All of those companies rely on access to your credit profile to verify your identity.