Depends on your definition of 'penalized'. FICO is all about identifying good ROI candidates.
Say you are a lender, you want someone who constantly uses credit, always pays their bills and has the capacity take on new debt. That's what FICO is for.
It's not some consumer reward system. It's not your score to game, it's a score on you for companies to game. Quit playing the game.
IMO the game is to get the highest credit score while spending the least on credit. That way if you e.g. need to acquire housing, a reliable vehicle, business loans, even employment or insurance, you will be able to and can get a good deal. Sure, paying nothing saves you money, but it also costs you the opportunity cost between what you could earn/save by utilizing credit vs waiting months to years to save up and pay cash.
The easiest approach is to get high point credit cards and pay them off each month.
That way, you don’t pay anything (and are subsidized).
Of course the money comes from people that don’t do this, and vendors’ margins.
So, it’s “Participate in the credit card racket or no house for you” on one side and “That’s a nice shop you have there. It’d be a shame if something happened to it.” on the other.
The US really should abolish the credit rating industry.
