Your credit score is one of the most influential numbers in your financial life. It affects whether you get approved for credit, what interest rate you pay, and even (in some states) whether you get an apartment or a job. Here's exactly how it's calculated — and what actually moves it.

The five factors (ranked by impact)

1. Payment History — 35%

The single biggest factor. Every on-time payment builds this score. One missed payment — even 30 days late — can drop your score by 50–100 points and stays on your report for 7 years. The fix is mechanical: set up autopay for at least the minimum payment on every card and loan. Even if you can't pay in full, paying the minimum prevents the hit. Late payments are the single most damaging thing you can do to your score.

2. Credit Utilization — 30%

How much of your available credit you're using. Under 30% is the standard advice; under 10% is optimal. This is calculated both per card and across all cards combined. A $1,000 balance on a $5,000 limit card = 20% utilization (good). A $1,000 balance on a $1,500 limit card = 67% utilization (damages your score).

The key move: pay your balance before the statement closing date, not just before the due date. Your balance reports to the bureaus on the statement close date. If you pay to $0 before that date, your reported utilization is 0% — even if you charged $2,000 that month.

3. Length of Credit History — 15%

Older accounts improve your score. This measures: age of your oldest account, age of your newest account, and average age of all accounts. This is why closing old credit cards is usually a mistake — even ones you don't use. An old card with no annual fee that you barely use is still working for you by keeping your average account age high. The exception: if the card has a fee and you're not getting value, the cost-benefit calculus may differ.

4. Credit Mix — 10%

Having different types of credit (revolving credit like cards, installment loans like auto/student/mortgage) modestly boosts your score. This is not worth taking on debt to optimize. If you naturally have a mix, it helps. Don't manufacture debt for this.

5. New Credit Inquiries — 10%

Each hard pull (when you apply for credit) can temporarily drop your score by 5–10 points. The effect fades after 12 months and disappears from scoring after 24. Shopping for a mortgage or auto loan within a 14–45 day window counts as a single inquiry regardless of how many lenders you check (rate-shopping protection). For credit cards, space applications 6–12 months apart to minimize impact.

What does NOT affect your score

Checking your own score (soft pull — zero impact). Your income. Your debit card usage. Being rejected for credit (the application = hard pull, the rejection itself = nothing). Your bank account balance. Paying with cash or check.

How to actually build or rebuild credit

Starting from zero: get a secured credit card (you deposit $200–500 as collateral, which becomes your limit). Use it for one small recurring charge. Pay in full every month. After 6–12 months, you'll have a score. Starting from bad credit: the same approach, but also focus on paying any collections accounts and disputing any errors on your credit report (free at AnnualCreditReport.com). Time + on-time payments = score recovery. There's no shortcut.

Get a credit score action plan
My current credit score is approximately [score range, e.g., 620–640]. My credit situation: I have [number] credit cards with a combined limit of $[X] and balances of $[X]. I have [any late payments/collections/bankruptcies]. My oldest account is [X years] old. Give me a specific, prioritized action plan to improve my score by 50–100 points in the next 6–12 months. What are the highest-leverage moves I should make first?
Evaluate a credit card application decision
I'm thinking about applying for [card name]. My current score is approximately [range]. I've applied for [X] cards in the last 24 months. Help me evaluate: will this application likely cause meaningful score damage given my current situation, is now a good time to apply based on my score and recent inquiry history, and is there anything I should do first to maximize my approval odds and minimize score impact?
smobyday tip

The fastest legitimate credit score boost: pay down utilization. If you have a card at 70% utilization and you pay it to below 30%, your score can jump 20–40 points within one billing cycle. It's the only factor you can meaningfully change in under 30 days.