What makes up your credit score

Your FICO score — the number banks use for almost every lending decision — is calculated from five factors. They aren't weighted equally, and two of them matter way more than the others. Knowing which is which is the difference between playing defense and optimizing.

The five factors

• Payment history (35%) — have you paid bills on time, and how recently did you miss one?
• Amounts owed / credit utilization (30%) — how much of your available credit are you currently using?
• Length of credit history (15%) — how old are your oldest accounts and how old is your average account?
• Credit mix (10%) — do you have a mix of credit types (cards, loans)?
• New credit (10%) — how many new accounts have you opened recently?

Common myths

• Myth: checking your own credit hurts your score. False — it's a 'soft pull' and invisible to lenders.
• Myth: carrying a balance helps your score. False — you pay interest for nothing. Pay in full, on time.
• Myth: closing old cards boosts your score. False — it usually hurts utilization and length of history.
• Myth: you need debt to build credit. False — one credit card used responsibly does it.