need tips on how to make a large terrain run more quickly and not lag when scrolling in and out.

Try turning off Contour graphics - this is the big performance killer for Terrain display. Without them performance is very good for massive terrains.

Are you referring to contour labels? 

Are there ruled features that were used to create this terrain?  Please describe the terrain creation workflow used, size (dgn size and geographic area e.g. square mile) and location of data used to create the terrain (e.g. from corridors, from external dgn files, etc).   It may be best to also show a screen grab of the Properties dialog showing the number of points, features, triangles, etc (Information tab).  

I believe the issue is, I did not thin enough points.  Its calculating a ton of points and making loads of triangles.

Turn off all calculated graphics, unless you need them for whatever task you're performing.
In the screenshot both the contours and triangles are set to On. If you only need an active terrain, the boundary is the minimum to be able to select the terrain when needed.