Credit Score Myths That Could Be Costing You Money

Hey! If you’ve ever stressed about your credit score but weren’t sure what really matters, you’re not alone. I used to believe a bunch of myths that almost held me back from improving my finances.

Here’s the truth behind the most common credit score myths — so you can stop losing money on interest, missed approvals, and bad financial choices.

Myth 1: Checking your own credit hurts your score

Truth: Nope! Only hard inquiries — like when a lender checks your credit — can affect your score. Checking it yourself through apps or websites is a soft pull and has no impact.
💡 Tip: Use free tools like Credit Karma or your bank’s app to keep an eye on your score.

Myth 2: You need to carry a balance to build credit

Truth: Absolutely not! Carrying a balance just means paying more interest. Paying off your credit card in full every month shows lenders you’re responsible — and keeps you debt-free.

Myth 3: Closing a credit card improves your score

Truth: Actually, closing a card can hurt your score, especially if it’s an old one. It reduces your total available credit and shortens your credit history, which can raise your credit utilization.

Myth 4: Income affects your credit score

Truth: Your salary isn’t part of your credit report. What matters is how you manage your credit, not how much you earn. Someone making $1,000/month can have a better score than someone making $10K if they handle credit responsibly.

Myth 5: All debt is bad for your credit

Truth: Not all debt is bad! Responsible debt, like a student loan or mortgage, can actually help build your credit if you pay it on time. The key is how you manage it, not the debt itself.

Myth 6: One missed payment won’t matter

Truth: Even one late payment can drop your score, especially if it’s over 30 days late. And it can stay on your report for up to 7 years.
💡 Tip: Set up automatic payments or reminders so you never miss a due date.

Final Thoughts

Old-school credit myths can quietly cost you money and opportunities. Knowing the truth helps you make smarter decisions, avoid unnecessary fees, and qualify for better deals on loans, apartments, and more.

If you want tools to monitor your credit, save money, or start building smarter habits, check out CHELSEAKNOWSFINANCE — everything shared there is trusted, beginner-friendly, and things I personally use or wish I knew earlier.

Take control of your credit — your wallet (and future self) will thank you!