Credit scores can be mystifying, and it’s hard to know what really impacts your numbers. But without knowing what does and doesn’t impact your credit score, it’s hard to know where to focus your attention. Here are four things that DON’T affect your credit score – and one thing that you can stop doing that can actually help you achieve financial stability.
Your income
That’s right – how much money you make has nothing to do with your credit score. Instead of trying to earn more money, work on saving the money you already have and put that towards paying off your debt, building your emergency fund, or investing for the future.
Your assets
Having more assets (such as a house, investments, cars, or multiple bank accounts) won’t affect your credit score in any way. However, bounced checks and overdrawn accounts can be reported to credit bureaus and cause your score to dip – so be sure that you’re managing your current assets wisely.
Your bills
In most cases, your rent, utility payments, and other regular monthly bills aren’t reported to credit bureaus, so they can’t make a dent in your credit score.
Your personal history, traits, or beliefs
Credit reporting companies don’t take into account factors related to your personal life or history, such as your gender, race, religion, national origin, marital status, political affiliation, medical history, criminal record, or whether you receive public assistance.
And the ONE thing you need to stop doing…
What if you heard that the best way to improve your score was to stop worrying about it altogether? Your credit score is really just a number that illustrates how good of a borrower you are. But you’re trying to get out of debt – not pile more debt up!
Ultimately, your main focus shouldn’t be on chasing a few extra points for your credit score. Instead, focus on paying off debt and building wealth so you can achieve the debt-free life you’re dreaming of!
Searching for a path towards debt-free living? Strong Tower Consulting can help!
