Your credit score affects your interest rates, rental applications, and in some cases, your job applications. Getting it wrong because of bad information is expensive. Here are seven of the most persistent credit score myths.
Myth 1: Checking Your Own Credit Score Hurts It
This is false and very widespread. Checking your own credit score is a "soft inquiry" and has absolutely no effect on your score. You can check it every day without any impact.
What does affect your score is a "hard inquiry," which happens when a lender checks your credit as part of an application for new credit (a credit card, loan, mortgage). Hard inquiries typically lower your score by 5 to 10 points and appear on your report for two years.
Myth 2: You Should Carry a Balance to Build Credit
This myth has cost many people real money. You do not need to carry a balance and pay interest to build or maintain good credit. Using a credit card and paying it off in full each month is the ideal behavior for your score AND your wallet.
Carrying a balance does not help your score. It just costs you interest money for no benefit.
Myth 3: Closing Old Credit Cards Improves Your Score
Closing old credit cards almost always hurts your score, not helps it. Here is why: it reduces your total available credit (increasing your utilization ratio) and it shortens your average account age (both negatives for your score).
The only reasons to close a card are if it has a high annual fee that exceeds its value, or if having the card open creates a real spending temptation you cannot manage. Otherwise, leave paid cards open and occasionally use them for small purchases you immediately pay off.
Myth 4: Your Income Affects Your Credit Score
Your income is not part of your credit score calculation at all. A person earning $30,000 with responsible credit habits can have a higher score than someone earning $200,000 who misses payments or carries high balances.
Lenders may ask about income when making lending decisions, but that is separate from your credit score.
Myth 5: All Debt Is Bad for Your Credit Score
Debt handled responsibly actually helps your credit score. Your "credit mix" (10% of your score) rewards having different types of credit: credit cards, installment loans, and possibly a mortgage. Responsibly managing a mix of credit types demonstrates that you can handle various financial obligations.
What hurts your score is debt you cannot manage: missed payments, maxed-out cards, and defaulted accounts.
Myth 6: A Bad Credit Score Is Permanent
Your credit score is not fixed. It is recalculated regularly based on your current credit behavior. While negative marks (late payments, collections, bankruptcies) stay on your report for 7 to 10 years, their impact on your score decreases over time, especially as you build new positive history.
Many people have significantly improved scores within 12 to 24 months of consistent responsible credit behavior. It takes time, but it is completely achievable.
Myth 7: You Have One Credit Score
You actually have many credit scores. There are three major credit bureaus (Equifax, Experian, TransUnion), and each calculates scores independently. Additionally, different scoring models (FICO Score 8, FICO Score 9, VantageScore) calculate scores differently.
This is why your score might appear different depending on which service you check it through. The information on your credit report is what matters most. If your reports are accurate and reflect good credit habits, your scores across different models will all be good.