How Credit Cards Affect Your Credit Score

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Having a credit card is more responsibility than you might realize. You have to be responsible enough to charge only what you can afford, pay back the charges you've made, plus you need to be mindful of how credit cards can impact your credit score. Everything you do with a credit card affects your credit score, from applying to a credit card to using one. Even not having a credit card can affect your credit score.

Your credit score is calculated using the information on your credit report (a record of your credit and loan accounts) and indicates the likelihood that you'll pay back money loaned to you. Each month or so your credit card issuer (among a few other businesses) reports your account activity to one or more of the three major credit bureaus to be included in your credit report.

That means your credit limit, credit card balance, payment history, account status, and date you opened the account will all influence your credit score. Learn more about that below.

Not Having a Credit Card Affects Your Credit Score

If you're one of many consumers who doesn't have a credit card, your credit score could be affected. That's if you have a credit score at all. Without open, active accounts on your credit report, you won't have a credit score. Not having a credit score makes it difficult to be approved for a mortgage, a car loan, or even an apartment.

Credit cards are one of the easiest types of credit accounts to be approved for which makes them a good option for establishing and building a good credit history. If you manage your credit well, your credit score will reflect that.


Having solid experience with different types of credit accounts—credit cards as well as loans—is good for your credit score because a mix of credit accounts for 10% of your credit score.

Your Credit Limit and Balance Information

Many credit cards have a preset credit limit, which is the maximum amount of credit your credit card issuer has made available to you. Using all your available credit makes you look like a risky borrower and your credit score will suffer because of it.

Many credit card issuers also report a "high balance" which is the highest balance ever charged on your credit card. So, even if you max out your credit card and pay it off, your credit report can still show that high balance. It's best to keep your credit card balance below 30 percent of your credit limit so you don't look like an irresponsible borrower.

Your Monthly Credit Card Payments

Your last credit card payment amount is listed on your credit report, but it's not factored into your credit score. Even so, your payment amount can indirectly influence your credit score. Remember that your balance relative to your credit limit is included in your credit score. Larger payments reduce your balance faster and can help boost your credit score.

The timeliness of your credit card payments is one of the most important factors influencing your credit score. On time credit card payments help boost your credit score while late payments will bring your credit score down.

On most types of accounts, late payments aren't reported to the credit bureaus until they're 30 days late. You might have to pay a late fee if you're a few days late on your credit card payment, but your credit score should be safe as long as you pay before you're 30 days past due.

Credit Card Applications

Each time you apply for a credit card, a record of your application goes onto your credit report. Your credit score doesn't factor in whether you're approved for the credit card or not, but making the application can have a negative effect on your credit score. Putting in several applications in a short period of time can hurt your credit score. For that reason, it's best to keep your credit card applications to a minimum.

The Number of Credit Cards You Have

Having too many credit cards can hurt your credit score. Unfortunately, the companies who developed the credit score haven't told us the exact number of credit cards that influences your credit score. The number likely varies from person to person.


In 2016, Walter Cavanagh of Santa Clara, Calif. earned the Guinness World Record title of “Mr. Plastic Fantastic” with 1,497 credit cards and a near perfect credit score. He reportedly only used one of the credit cards. In 2019, Zheng Xiangchen of Shenzhen, Guangdong, China, surpassed that record with a collection of 1,562 cards.

Keeping Your Credit Cards for a Long Time

The longer you've had your credit cards open, the better it is for your credit score, especially if you have a positive payment history with those credit cards. Keep your oldest credit cards around, and use them periodically to help out your credit score, but also make sure you check out the latest credit card deals from time to time. If you have a good credit score, there's a chance you can qualify for a credit card with better terms and rewards than the one you've had since you were a young adult.

The key to making sure your credit cards don't hurt your credit score is to keep them open and active, in good standing, and with low balances.

Frequently Asked Questions (FAQs)

How harmful is it to close a credit card account?

Closing your credit card will hurt two categories of your credit score: your average age of credit and your credit utilization ratio. The level of impact on your credit score depends on how many other credit cards you have. If you have many more credit cards, closing one won't have as much of an effect as it would if you only have one other credit card.

How long does it take to raise your credit score after getting a new card?

Building credit takes patience and persistence, so you shouldn't expect immediate benefits after getting a new credit card. However, as soon as your credit card company starts reporting to credit bureaus, it'll start impacting your report. Credit card companies typically report information at least once a month, so you can expect to see your credit utilization ratio drop and your on-time payments increase after a month or two.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
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