10 Things You Think Affect Your Credit Score — But Don't

By Mark Jackson. Last updated 18 July 2014. 2 comments


There are a lot of misconceptions when it comes to personal credit. One reason for this is the way your credit score is determined is largely shrouded in secrecy. Because of this, there are many things that you may think affect your score that actually don't. Let's go through a few of these below! (See also: How to Rebuild Your Credit in 8 Simple Steps)

1. Your Age

Age is not a consideration when you take a look at the credit score breakdown. Many feel that you'll have a worse credit score when you're younger, but in reality, it's not your age that matters — it's how much you've used credit. Opening a low-limit credit card, using it, and paying the bill in full every month can help you establish your credit history at a young age.

2. Unemployment

As long as you continue to pay your credit card bills, unemployment will not affect your credit score at all. Late payments or missing a payment, however, will affect your score.

3. Breaking a Lease

Not paying your rent or breaking your lease will not affect your credit score, as long as your landlord does not take you to court and win a judgment against you. Renting and leasing property or things isn't something credit card reporting agencies track.

4. Not Carrying a Balance

This is one that I hear about the most from friends and family, but it's not true. In fact, having a low credit utilization ratio, or none at all, helps, as stated here.

5. Debit Cards

Overdraft your debit card accidentally? No problem (well, for your credit score). Since the bank has not extended any credit to you in giving you this card, you won't have any negative consequences on your credit from accidental overdrafting.

6. Not Spending on Your Cards for a Time

Just because you don't spend any money on your credit cards for a time, doesn't mean that your credit score will be hurt. It's only closing credit that may affect your score negatively — but not always. For example, closing your oldest credit card will affect the length of your credit history, thus negatively affecting your score.

7. Marrying Someone

While joint accounts may be affected, your personal credit score will not be affected by your spouse's bad credit. So, if you plan on marrying someone that has had some financial difficulties in the past, go for it! But know that filing for joint credit may result in a lower score than your personal score.

8. Not Paying Taxes

As long as the government does not put a lien on your property, not paying your taxes on time will not affect your credit score. I would probably recommend that you do pay these on time, though… it's sort of required.

9. Level of Interest Being Paid on Credit Card Accounts

The amount of interest that you are paying on remaining balances for your credit card accounts does not, in fact, affect your score. Your credit score does affect the initial size of your APR on most cards, though.

10. Your Location

Some may think that your credit score has something to do with your location (like people in big cities having better scores than rural customers). But your credit score is unaffected by matters that don't affect your spending habits.

Are you surprised by any of these? Relieved that your credit might be better than you thought?


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Noah Boardwalk Savers

Another myth that people should know is that having a larger number of credit cards does not necessarily help your score. Oftentimes people get more credit cards than they need in order to boost up their score. It’s definitely not beneficial in the long run. The credit score companies evaluate your debt to credit ratio, which means that having more credit open to you without using it can potentially have some positive impact on your score. However, the issue is, studies have shown that even the most responsible shoppers are tempted to spend more when using a credit card. Don’t get a new credit card unless you absolutely need it.

Guest's picture

Great post! It's also important to realize that credit reports are just as important as credit scores. There's another myth that your credit score is the only thing that matters, not what is on your report. Clearly, this is a false claim. Your credit score is similar to a score on a test and your credit report is the actual test. Without seeing all the reasons that impacted your grade, you won't know what you are doing right or wrong.