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FICO’s Jenelle Dito shares personal lessons around credit and how finlit impacts her job educating about credit scores.
When you work in the finance industry, money is on your mind. But not everyone thinks about debt. Debt inevitably comes up if you work in the credit industry, though, like Jenelle Dito, senior director of the FICO Score department at the American company Fair Isaac Corporation. Never heard of FICO? Think: one of the OG credit rating companies (FICO started in 1956), which provides info to consumer credit reporting agencies Equifax and TransUnion. Dito’s admittedly passionate about financial literacy and creating tools for people. With MoneySense, though, she talks about how things like credit cards and budgeting affect her personally.
I gravitate towards those who invest in their passions, cultivate change in an area important to them and who achieve a successful return. I know the term “activist investor” is used often now, but it’s been around for a long time. Reese Witherspoon is a great example, as she invests in producing stories by and for women and ends up with amazing projects.
I describe myself as the laziest active person. I enjoy running, travelling and being social with friends, but I’m also very happy to watch movies at home and hang out with my dogs. My kids are in college now, so it’s been a change to my time—really being my own, not juggling work and their activities all the time.
I would spend more time with my family and travelling the world. Although there’s always been a part of me that wants to own a restaurant, I know nothing about that type of business. But the idea of being an entrepreneur always lingers in the back of my mind.
I went to the grocery store regularly with my grandmother when I was in elementary school. We would cut coupons and go to multiple stores to get the best quality for the best price. She taught me about which “generic” products to buy and which ones to splurge on. She felt strongly about not wasting money, which I still carry throughout my life today.
I have three older brothers, so I was always influenced by their taste in music, movies and TV. So, I probably didn’t have the most appropriate favourites as a kid. I remember buying a cassette tape by The Cars and being so proud when my brothers wanted to listen to it with me. It was a prized possession.
My first “real” job was as a dishwasher at a local restaurant. It was great to have the opportunity to earn a paycheque, but it was humbling work. I used every cent to buy new clothes and go to the movies with my friends.
In college, shortly after turning 18, I opened several low-balance credit cards that were targeted toward students. I quickly maxed them out from shopping and splurging on clothes and was left with lingering bills and fast accumulating finance charges. It took me years to pay off those credit cards. Back then, I didn’t have access to check my credit score, but I’m sure if I were to view my FICO score (Fair Isaac Corporation) back then, it would have been very low. Knowing how much I owed and how much my total increased with interest when it went unpaid was a weight on my shoulders. The feeling of relief I felt after paying off my credit cards and learning to spend within my means is something I’ll never forget. I’m grateful that my lesson learned with credit cards happened at a time in my life when I didn’t have a need for a larger access to credit. It would have been devastating to be denied a mortgage or loan when I really needed it.
“Think about it”—meaning, to avoid impulsive spending by being thoughtful about your decisions and the consequences. Even going back to my early learnings of valuing grocery shopping fits into this. And of course, now as a leader in financial education at FICO, I know that knowledge is everything. It doesn’t mean that every decision is the most prudent; just that it’s deliberate. Also, I have learned that the more you are aware of your credit score and financial situation, the more in control you feel about it.
I grew up in the generation who didn’t talk about money. My parents were very private about income and expenses. It’s not exactly “the worst advice,” it was the lack of conversation and transparency on how to manage it, increase it and invest it that left a gap.
I’m not much of a risk taker, so I’d probably go for smaller amounts for life. Although it’s wonderful to fantasize about receiving a large sum and doing something extravagant with it, I’d have difficulty executing on something like that. I’d prefer to invest and collect an annuity from the investment, in essence, creating smaller payments for life.
To be prepared—if you can predict it, you can prevent it. Know where you stand with your budget, your credit and your access to credit. By knowing and understanding your FICO score, you can feel confident you can withstand an emergency with access to credit or loans. If you purchase a luxury car, you can predict that it will come with luxury maintenance—be prepared for that when you make the decision to purchase. I really value education and knowledge.
I think there’s a barrier to entry that is intimidating. People think they need to know how to pick a stock to invest in or dedicate time to day-trading. Growing money is about investing wisely and consistently. The most important thing is to start doing it. Invest in something you’re comfortable with. There are tons of options that are low risk and low cost.
I love a good deal and I never spend for the sake of it. It’s probably easier for me to identify things I don’t spend money on, than what I do spend money on. I don’t see the value of higher-end athleisure wear. But cereal? That’s where I can tell the difference, and I always spend more.
The obvious answer: a home. While that was a major decision that took a lot of planning and time, I remember really feeling like an adult when I went on my first self-funded vacation.
I think debt can be healthy, and you’re even rewarded for responsible management of debt in your FICO score. Financing a home, car, student loan or even a major purchase is a great use of credit. It can potentially get out of control when you’re financing beyond your sustainable means. Going into debt for day-to-day expenses is not a good idea.
My most recent splurge was a vacation. My family and I recently spent the holidays in Mexico. We are grateful to spend time at an all-inclusive resort. I love that the spend is up-front, so you relax and just enjoy the resort when you’re there.
I have college-aged children, so the last book I read was “I Want More Pizza” by Steve Burkholder—which did a great job of making finances and budgeting relatable.
I wish it was always a small amount of cash, but I regularly find that I don’t have any. I love using Apple Pay with my favorite cards loaded on my phone—so now I barely need a wallet at all.
My grandmother’s wedding ring. I admired it growing up, and when she passed away nearly 20 years ago, she left it to me in her will. I cherish it and wear it daily as a reminder of her.
With two kids in college, I’m focused on tuition and school expenses. I hope the savings I’ve put aside over the years will cover the majority of the costs so they don’t graduate with debt. After we get through this phase, then I’ll focus on retiring—but that’s many years away.
Own.
Lease.
Invest.
Absolutely budget.
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Ms. Dito – I am happy to hear that ‘I Want More Pizza’ helped your children! Thank you for all that you do each day with respect to financial education. Steve Burkholder
Great interview, I really enjoyed read it it. Jenelle talks about maxing out credit cards and how it negatively impacted her credit. However, different countries employ different approach in calculating credit score.
I myself have 20+ years of experience in data driven industries, credit bureaus included. So I kind of know how it works (I thought)
Recently I established credit in the US by opening a low balance credit card, just like Jenelle did. Guess how insulted I was when all three bureaus dropped my credit by more than 60 points just over night. No late payments, no visible negative factors either. Then, after talking to my banker I was advised not to carry over more than 70% of my balance to the next billing cycle. And this is where the trick is – in developed economies (and conservative markets) the less your credit card balance is the better, in developing economies (and wild markets) it is the other way around. Why is a whole different story, but the fact is that the lesson learned – billing cycles always end with zeros, credit repaired and I am back to high credit scores.