I've made it to what is typically classified as an "excellent" score with practically no debt and have paid no interest all while spending within my means. Here's how I did it.

I have several credit cards that I keep paid off every month. I almost always buy things with store promotion credit (no fees or interest), which is typically another credit card or small loan, and pay it off within the promotional period. I do this with purchases I need to make anyway, like a washing machine, and not on anything frivolous.

I paid all expenses for a nice vacation recently with new travel cards. I could have paid out of pocket, but now I can pay it off slowly with 18 months interest free and get the points.

I do drag these payments out a little during the promotional periods because while I can pay outright I do like keeping cash reserves for emergencies. That probably does help.

The only loan I have ever had was a very very small student loan. Paid that immediately after covid loan pauses ended. I did recieve a credit hit of about -20, but in 3ish months I was above where I started. I've noticed everytime I pay off any large credit it takes an immediate hit, but always grows higher in a few months.

So far I've not been denied on any credit I've accessed and typically get good terms, so I'm not sure how true it is that I'll be denied for having a good score. But I am just barely at that "excellent" score.

Now the downside and credit to your point is this took a very long time. If I bought a ton of things I could barely afford and just barely made payments, maybe even missed a few, my score would have grown so much faster. Paying on an irresponsible loan for 5 years is considered "better" than me paying my credit card off every month.

Imo that's the racket, people that spend irresponsibly grow their score much faster. It does indeed promote overconsumption.

But it is still possible to grow a good credit score with slow incremental work. It's unfair and a bad system. I'd rather not have to do any of this, but it's possible.