5 Surprising Ways You Could Be Hurting Your Credit
When it comes to protecting your credit score, most people know the basics—pay your bills on time, don’t max out your cards, and avoid too much debt. But what if I told you that some things that seem smart—like paying off all your debt or closing old credit cards—can actually do more harm than good?
Let’s talk about a few counterintuitive credit habits that might be working against you, even if your intentions are good.
Closing Old Credit Cards
It might feel satisfying to tidy up your wallet or close out a credit card you never use, but here’s the catch: the length of your credit history makes up a big part of your score. That old card you’ve had for years? It’s helping show that you’ve been a responsible borrower over time. Closing it could shorten your credit history and lower your score.
Paying Off All Your Debt
Wait—what? Isn’t that the goal? Well, yes and no. While paying off high-interest or unnecessary debt is definitely a win, lenders actually want to see that you can manage debt responsibly. Having a small balance that you pay off consistently shows you're credit-worthy. A completely zero balance across the board can sometimes work against you.
Co-Signing Loans
It’s natural to want to help a friend or family member get approved for a loan, but co-signing ties your credit to theirs. If they miss payments or default, it reflects on your credit report and can hurt your score significantly. Think carefully before putting your name on someone else’s loan.
Applying for Credit Too Often
Shopping around for the best loan or credit card deal makes sense, but be mindful of how many applications you submit in a short period. Each application can result in a “hard inquiry,” and too many of those in a short window can ding your score. Space them out if you can.
Ignoring Small Bills
That $40 bill from the cable company or gym membership you canceled months ago? If it goes to collections, it can do lasting damage to your credit—potentially for up to 10 years. Set reminders, check your statements, and don’t let the little stuff slip through the cracks.
Final Thoughts
Managing your credit isn’t just about avoiding the obvious mistakes—it’s also about being aware of the not-so-obvious ones. These small actions, while well-intentioned, can have a big impact on your financial health. Stay informed, stay alert, and your credit will thank you.