9 Things That Don't Affect Your Credit Score
There are hundreds of things that affect your credit score every day. From how much credit you use to how much of your balances you pay off each month, the list goes on. However, there are a number of things that you may think affect your credit score, but in fact do not.
Not spending money.
Many people want to "take a break" from their credit cards for many reasons (usually to
spend less), and are worried that it will negatively affect your credit score. Don't be. Spending $0 on an account will not affect your score. In fact, if you are able to pay down the balances you owe a bit during your break, it will help your score.
Where you live.
I've heard one person tell me that people in big cities have better credit scores because they are perceived as better customers. This couldn't be further from the truth. You could be an onion farmer in Iowa and have a better credit score than a finance guy on Wall Street, if you manage your credit score better. Location has no bearing on your score.
How old you are.
While the length of your credit history does factor into your score, your actual age does not. So, you could have a high score as a 19 year old, or as a 79 year old, if you take care of your credit well.
Not having a job.
While not paying your bills will certainly affect your credit score, filing for unemployment will not negatively affect your score.
Breaking your lease.
If you have to ditch an apartment or miss a rent payment, that will not negatively affect your score. However, if you are taken to court and a judgement is won against you, that will affect your score negatively. By the way, it's always a good thing to pay your rent!
While legally credit reporting agencies can use your criminal record to factor in your credit score, they have a longstanding practice not to do so. However, your record does appear on background checks and consumer reports, so bigger loans, like a business loan, may be affected by your record. Try not to go to jail, though.
Your debit cards.
Since debit cards are linked to your bank account, and not actually lending you any money, you are not affected by accidentally over drafting your account or running a low bank account balance.
Not paying your taxes.
Being a little late on taxes one year will not hurt your FICO score, but if the government puts a lien on your property or wages, you can bet your credit score will be affected. In addition to rent, I would recommend paying taxes every year. They'll find you, eventually.
If you are a good credit card user, and pay off your balance in full each month, this is a great thing. I can't tell you how many times I've heard people try to tell me that credit card companies will give you a better score if they are "making a little money off of you every month." Not true.
If you're interested in how your score is broken down, check out FICO's website. Some things are changing, too, which we wrote about here. As always, the best way to have a good credit score is to pay your bills off each month, and never spend beyond your means.