Don't fall for these 3 myths about how to boost your credit score


Boosting your credit score can save you thousands of dollars on mortgage, auto loan, or private student loan payments.

If you want a higher credit score and are taking steps to improve it, make sure you have good information. Some common ideas about how to boost your score don't work — and some can even end up hurting you. For instance, 12% of people said they canceled a credit card in order to help their credit score, according to a 2019 Bankrate survey of 2,582 adults, including 2,301 credit cardholders. In fact, canceling a card with a longstanding credit history can actually drag down your score.

If you're not sure what helps or hurts, don't worry. We've busted three common credit score myths about what does, and doesn't, boost your score.

This is how your credit score is actually measured

Video by David Fang

Myth 1: It's helpful to carry a balance

You may have heard that it's a good idea to carry a balance from month to month because it can help you build a strong credit history and in turn boost your score. But carrying a balance can actually hurt your score. That's because your credit score depends in part on your utilization rate, which is the relationship between how much credit you've used to how much credit is available to you.

A good rule of thumb is to keep your utilization rate below 30% on each card individually and on the total amount of credit available to you. When you go above that percentage, "that's when [your utilization rate] starts impacting your score," Matt Schulz, a chief industry analyst at, told Grow earlier this year.

Experts suggest paying off your balance each month if you can.

Read more: 3 simple ways to maintain good credit

Myth 2: Canceling an old credit card can help your score

Even if you're no longer using an old credit card, canceling it can lower your score. That's because canceling the card lowers the amount of overall credit you have available to you, which in turn affects your utilization rate.

"I would say it's very rare that I would advise canceling a card because of the credit score benefit," Bankrate analyst Ted Rossman told Grow earlier this year. "It usually makes sense to leave it open, even if you're not using it."

Read more: Don't make this mistake with your old credit cards

Myth 3: Just pay bills on time and you'll be fine

It's true that paying your bills on time every month helps your credit score, but it isn't all that matters. Your credit score is generated using an algorithm that includes several factors relating to your spending history and your ability to pay off debt.

To earn and maintain a high score, try to pay off your credit card balances in full each month and be cautious about how often you take out new loans or apply for new cards. That helps you establish, and maintain, a solid credit history.

Read more: 'Your credit score is probably the most important number in your financial life' — here's how it works

3 steps to build your credit score with Matt Schulz
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