How to Understand the 5 Factors That Move Your Credit Score

Learn the five components that determine your credit score and how much each factor actually matters for your rating.

1. Track your payment history above all else. Payment history makes up 35% of your score — the biggest chunk. Pay every bill on time, every month. Even one missed payment can drop your score 60-100 points and stay on your report for 7 years.
2. Keep credit utilization below 30%. Credit utilization is 30% of your score. This means using less than 30% of your available credit limits across all cards. If you have $10,000 in total credit limits, keep balances under $3,000 total. Lower is better — under 10% is ideal.
3. Let your credit age naturally. Length of credit history accounts for 15% of your score. Keep old accounts open even if you don't use them much. The average age of all your accounts matters, so opening new cards frequently will hurt this factor.
4. Add different types of credit slowly. Credit mix is 10% of your score. Having both revolving credit (credit cards) and installment loans (car loans, mortgages) can help. But don't take on debt you don't need just to improve this factor.
5. Limit new credit applications. New credit inquiries make up 10% of your score. Each hard inquiry can drop your score 5-10 points temporarily. Multiple inquiries for the same type of loan within 14-45 days typically count as one inquiry for scoring purposes.