Credit Myths That Cost Money

Credit folklore is expensive. A handful of repeated myths - carrying a balance helps, checking your score hurts, closing old cards is tidy - quietly cost people points and dollars every year.

Why it matters

Myths spread because they sound like common sense. Each one below is disproved by how the scoring models actually work, and dropping them is the cheapest score improvement available.

Key facts

• Myth: carrying a balance helps your score. Fact: you can pay in full every month and still build history; interest buys you nothing.
• Myth: checking your own credit hurts it. Fact: self-checks are soft inquiries and never count.
• Myth: closing your oldest card is good hygiene. Fact: it can shorten your history and raise your utilization.
• Myth: income is part of your credit score. Fact: income is not in the report or the FICO formula, though lenders ask for it separately.
• Myth: debit cards build credit. Fact: debit activity is not reported to the bureaus.
• Myth: you and your spouse share one score. Fact: files are individual; only joint accounts appear on both.

In practice

1. Pay statement balances in full when you can; report a small balance if you want activity shown, but never pay interest for the privilege.
2. Keep old no-fee cards open with a small recurring charge.
3. Before repeating credit advice, check it against myFICO or the CFPB, not a comment section.