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Myth-Busting Your Credit

by | Apr 14, 2026 | Budgeting, Education, Financial Well-being, Personal, Strategy

Myth-Busting Your Credit

If you are looking to level up your financial standing, your credit score is the best place to start. Don’t let common myths about ‘soft inquiries’ or ‘monthly balances’ distract you from effective growth strategies. Let’s debunk the two biggest myths holding you back and get your score moving in the right direction.

Myth #1: Checking your own score hurts it. The Fact: When you check your score (a “soft inquiry”), it has zero impact. Only “hard inquiries” from lenders when you apply for a new loan can cause a temporary dip. Check your score as often as you like—it’s one of the best ways to spot identity theft early! Most major banks and credit card issuers allow you to check your credit score for free through their mobile app or online banking portal. These services usually update monthly or weekly, provide FICO® or VantageScore® models, and do not impact your credit score when you check them.

Myth #2: You should carry a monthly balance. The Fact: You do not need to pay interest to have a high score. In fact, your “Credit Utilization” (how much of your limit you use) accounts for 30% of your score. Paying your balance in full every month shows lenders you’re a responsible borrower—and keeps your money in your pocket instead of going toward interest.

Pro-Tips to Level Up Your Score

Want to see your score climb? Start by focusing on these four key pillars of credit health:

  • Watch Your “Utilization” (The 30% Rule): Optimize your “Utilization” by keeping balances under 30% of your total limit. For example, if your limit is $1,000, aim to stay below $300 to show lenders you aren’t overextended.

  • The “Payment Streak”: Protect your payment history—the most critical factor (35%) in your score. Use Auto-Pay for at least the minimum due to ensure a flawless streak of on-time payments.

  • Keep Old Accounts Open: Even if you don’t use an old credit card, closing it can actually lower your score by shortening your “length of credit history” which accounts for 15% of your score. If there’s no annual fee, let it sit! Issuers may close inactive accounts after a long period of inactivity. To prevent closure, use the card sparingly for small purchases—like a streaming subscription—every few months. Remember to set up Auto-Pay to avoid late fees and interest.

  • Monitor Your Credit Regularly: Stay vigilant against inaccuracies. Regularly reviewing your reports allows you to quickly dispute errors with the reporting bureau and protect your score from unfair dips.

Take Control of Your Credit

The first step to improving your credit is seeing exactly what the lenders see. Use these official resources to monitor your progress:

  • The Official Source: AnnualCreditReport.com is the only website authorized by Federal law to provide your credit reports for free.

  • Your Bank or Credit Union: Many banks and credit unions offer complimentary credit monitoring services. Contact your financial institution to see what tools are available to you.

  • Request by Phone: If you prefer to speak with someone or request your report by mail, call 1-877-322-8228.

  • The “Big Three” Bureaus: If you spot an error on your report, you’ll need to contact the specific bureau to dispute it:

Staying on top of your credit report is one of the simplest ways to protect your financial health. Use these tools to stay informed, catch errors early, and keep your financial future on the right track.