Credit Karma: Get a Free Credit Score and So Much More

By Josh Patoka   Updated 05/05/2021 at 9:08 am

We strive to provide you with valuable information & resources. Many or all of the products we link to here are from partners, and we earn from qualifying purchases or signups. Opinions are from the author alone.

Do your friends or family track their free credit score on Credit Karma? This free platform is a legit way to monitor your credit, file your taxes, and open a high-yield savings account.

You might be trying to build credit or repair your credit. Credit Karma can be one of the easiest ways to improve your finances.

This overview of Credit Karma helps you learn more about their credit tracking tools and other services. They offer many services that you may not be aware of, in addition to offering a free credit score. You can decide if their services can help improve the way you manage money.

How does Credit Karma really work?

Credit Karma is a free online service and mobile app that does quite a few things — probably way more than many people may realize.

Many of their free tools include:

  • Credit score monitoring
  • Credit score simulator
  • Identity monitoring
  • Unclaimed money
  • Financial calculators
  • Online tax preparation
  • Money market account

If you’re currently paying for these services elsewhere, Credit Karma is a free alternative. They have been offering free credit score monitoring since March 2008.

Where to join Credit Karma: You can become a new member here.

Cost: Free

Is it safe to use Credit Karma?

It’s as safe as any major online platform. (Any website can be compromised.) So, only open an account if you feel comfortable with having your personal information on one more online outlet.

You can review their security practices for an in-depth look at how they protect your personal information.

For instance, they use 128-bit encryption or higher to protect your data. Online banks use 256-bit encryption and certain Credit Karma pages will have this encryption as well. They also hire an external security team to audit their website. Programmers can hunt for coding bugs that hackers may access. If they find one, the programmer earns a cash bounty.

What happens to your personal information?

Their privacy policy lists how they handle your personal information.

Perhaps most importantly, Credit Karma won’t sell your information to third parties for advertising or marketing purposes.

They also won’t share your credit reports with unaffiliated third-party partners like banks, credit card companies, or online lenders. However, they may use your personal information to recommend products or services inside your dashboard.

How do they make money?

Credit Karma can be 100% free to use. For example, I have been using them since 2015 and have never paid a penny for their services.

However, they will recommend credit cards, personal loans, and auto insurance. If you apply for one of these products, Credit Karma may earn a referral fee, so this is how the make money.

The good news is that they never require you to apply for a recommended product to remain a member. It’s up to you whether or not you even consider the recommendations.

How can I get my credit score for free?

Credit Karma provides you with a free credit score (the VantageScore 3.0) from both Equifax AND TransUnion. You must first create an account in order to get this. Then, you will need to provide your personal information such as your name, home address, and Social Security number.

The credit bureaus may also ask questions based on information they already have from your credit report in order to verify your identity. Sample questions may include:

  • Name of your student loan provider
  • A previous street address you lived at
  • Which year you applied for a loan or a credit card

You will need to submit this information even if you get your credit score from another free credit score website. Your score from each bureau updates weekly.

Most free credit score websites only provide your VantageScore 3.0 score from TransUnion. With Credit Karma, you can track your score from Equifax as well. Having scores from two bureaus makes it easier to look for credit report errors. Also, lenders don’t report every payment and inquiry to the three bureaus. Because of this reporting gap, your scores can differ by 10 or 20 points.

How does Credit Karma affect your credit score?

Your credit score is never affected when Credit Karma retrieves your credit score, credit report, or recommends financial products. This is because they only do a soft inquiry.

However, if you submit an official application for a credit card or loan through them (or through anyone else) the potential lender will do a hard inquiry. Only hard inquiries appear on your credit report and temporarily lower your credit score.

Is the Credit Karma credit score accurate?

One complaint about Credit Karma is they provide the VantageScore 3.0, which is sometimes referred to by people as a “FAKO credit score”. This VantageScore is different than the FICO credit score that most lenders use to approve or deny your credit applications. But, it’s still useful!

And the VantageScore 3.0 you get from Credit Karma is a legit credit score. It was created by the three major credit bureaus (Equifax, Experian, and TransUnion) as an alternate scoring model.

With both types of scores, lenders see the same information on your credit reports. The primary difference is the formula each credit scoring system uses to determine your three-digit number.

Both credit scoring systems weigh the following credit report factors differently:

  • Payment history
  • Amount of debt
  • Length of credit history
  • Credit mix
  • New credit

What you may not realize is that each industry uses a different version of your FICO score, and there are many many versions.

For example, auto lenders use a version that emphasizes your previous auto loan history. Banks may use FICO Score 4 for home mortgages but your FICO Score 8 for credit card applications.

To have FICO scores, you need at least six months of credit history. But you only need one month of credit history to generate a VantageScore. If you are just starting to build credit, the difference between your FICO and VantageScore can be greater.

Real-life example of FICO Score vs. VantageScore 3.0

Below is an example of how my VantageScore 3.0 scores compare to my FICO Score 8:

  • FICO Score 8 (Experian): 798
  • VantageScore 3.0 (Equifax): 796
  • VantageScore 3.0 (TransUnion): 796

796 Excellent Transunion and Equifax calculated using VantageScore 3.0
You can see they are all fairly similar. While there is only some variation in these particular scores, they can fluctuate as much as 20 points. This volatility can happen right after opening a new credit card or loan. Or, if you are beginning to build credit.

Your VantageScore can be several points higher or lower than your FICO score from the same bureau. While the VantageScore isn’t the same score most lenders use, it still gives you a firm idea of what your FICO score may be. If having a FICO score is necessary, you will most likely need to pay for a premium service like myFICO at $19.95 per month or higher. Even then the scores you buy may not be the same as the ones a lender uses. And if you’re applying for a mortgage, for example, the lender may give you the exact scores they used for free.

Does Credit Karma have a credit simulator?

Credit Karma does have a credit score simulator. This tool estimates how events like closing credit cards or missing a payment can impact your score. While the exact effect can be different than what thy prediction, the simulator can help you make good credit decisions.

How can I file my taxes for free?

Credit Karma lets you file your federal and state tax returns for free. If you use TurboTax, you may pay if you file an advanced tax return. For instance, TurboTax charges a fee when you itemize, sell investments, or have self-employment from a side hustle to report.

You can also get free audit defense for your federal tax returns. This free coverage even applies if you use another tax prep software (i.e., TurboTax, H&R Block, or your local CPA). The Credit Karma case resolution specialist will help you navigate the audit process and attend local meetings with you.

What is Credit Karma identity monitoring?

Their identity monitoring tools have a few different benefits:

  • Credit report alerts (receive alerts when credit applications, account openings, and account closings appear on your credit report)
  • Freeze credit reports (Request a credit freeze for your Equifax and TransUnion credit reports)
  • Data breach monitoring (see exposed passwords and reported events when your personal information was leaked in a data breach)

Is Credit Karma Savings FDIC-insured?

Their newest service is a high-yield Credit Karma Savings online bank account. If your current bank savings account pays no interest, this can be an exciting product.

  • No account fees
  • Zero minimum deposit to open
  • Entire balance earns 0.56% APY interest (as of April 22, 2020; check their site for the latest rates)
  • FIDC-insured up to $5 million
  • Can make six penalty-free monthly withdrawals

Credit Karma Savings offers one of the highest interest rates you can earn for any bank account. At the current 1.90% annual interest rate, you will earn $19.17 in interest annually for every $1,000 you leave deposited.

Not having to pay any account maintenance fees means you don’t lose any of your interest income to fees.

Credit Karma partners with over 800 banks so you can have up to $5 million in FDIC-insured bank accounts. Only your first $250,000 in deposits qualify for FDIC-insurance at each bank. If you happen to have more cash than this, you will need to open accounts at different banks to insure every dollar.


Credit Karma is a legit way to track your credit score. Their free identity monitoring, online tax preparation, and high-yield savings are also industry-leading. Unless you have a complex personal situation, you can probably use some of their many features to simplify your life. You may also reduce your monthly expenses in the process.

How does Credit Karma really work?

4 thoughts on “Credit Karma: Get a Free Credit Score and So Much More

  1. Hi I tried registering but it says I’m registering in an old e-mail. I would like to update it

Leave a Reply

Your email address will not be published. Required fields are marked *