10 Surprising Things That Don’t Affect Your Credit Score

When it comes to credit scores, misinformation abounds. Many consumers worry unnecessarily about actions they believe will damage their creditworthiness, while overlooking factors that genuinely impact their scores. This comprehensive guide will debunk common myths and reveal 10 surprising things that don’t affect your credit score, giving you clarity on what truly matters for your financial health. Whether you’re in the UK, US, Canada, Australia, or elsewhere, understanding these distinctions can help you focus your efforts where they’ll make the most difference.

Understanding What Actually Impacts Your Credit Score

Before diving into what doesn’t affect your credit score, it’s helpful to briefly review what does. Across most credit scoring models worldwide, these factors typically influence your score:

• Payment history (typically 30-35% of your score)
• Credit utilization (typically 25-30%)
• Length of credit history (typically 15%)
• Credit mix (typically 10%)
• New credit inquiries (typically 10%)

You can use our Credit Score Simulator to see how changes in these factors might affect your score. Now, let’s examine what surprisingly doesn’t impact your credit standing.

1. Your Income and Employment Status

Perhaps the most surprising element for many consumers is that neither your income nor your employment status directly affects your credit score.

Why Income Doesn’t Matter to Credit Bureaus

Credit scoring models don’t consider:

• Your annual salary
• Recent pay raises or cuts
• Employment bonuses or commissions
• Investment income
• Inheritance or gifts

This means a person earning £250,000 annually could have a lower credit score than someone earning £25,000. Why? Because credit scores measure how well you manage credit, not how much money you make.

What matters instead: Your debt-to-income ratio (DTI) is important to lenders but isn’t factored into your credit score calculation. However, high income can indirectly help your credit by making it easier to keep credit utilization low and payments on time. Use our Budget Planner to manage your finances regardless of income level.

Employment Status and Job Changes

Similarly, these employment factors don’t impact your score:

• Being unemployed
• Changing jobs frequently
• Employment gaps
• Being self-employed vs. employed

While lenders may consider these factors when approving credit applications, the credit bureaus don’t include them in score calculations.

What matters instead: Maintaining on-time payments during employment transitions is what affects your score, not the transitions themselves.

2. Checking Your Own Credit Report

Many people avoid checking their own credit reports for fear of damaging their scores—but this concern is completely unfounded.

The Difference Between Soft and Hard Inquiries

• Soft inquiries (including checking your own credit) have zero impact on your credit score
• Hard inquiries (when applying for new credit) typically lower your score by a few points temporarily

You can check your own credit report as frequently as you like without any negative consequences. In fact, regular monitoring is recommended to catch errors and potential fraud early.

What matters instead: Multiple hard inquiries from applying for several new credit accounts in a short period can lower your score. However, most modern scoring models recognize rate-shopping for a single loan type (like a mortgage) and count these as a single inquiry if done within a typical shopping period of 14-45 days.

3. Your Savings, Investments, and Retirement Accounts

Your overall wealth and investments don’t directly influence your credit score, which surprises many financially savvy consumers.

Banking Activity Outside Credit Products

These financial assets and activities have zero impact on your credit score:

• Savings account balances
• Checking account activities (unless overdrafts go to collections)
• Investment portfolios
• Retirement accounts (401(k), IRA, pension plans, etc.)
• Property ownership paid in full
• Inheritance or trust funds

Having a million pounds in savings won’t boost your credit score, and similarly, having minimal savings won’t lower it.

What matters instead: How you manage debt and credit obligations is what credit bureaus track, not your assets. That said, having healthy savings can indirectly help your credit by providing a financial buffer during emergencies, reducing the likelihood of missed payments. Our Retirement Savings Calculator can help you plan for future financial security.

4. Rent, Utility, and Mobile Phone Payments (Usually)

Traditionally, regular payments that aren’t credit-based don’t affect your credit score, though this is gradually changing in some regions.

Traditional Reporting Limitations

These regular payments typically don’t appear on your credit report:

• Rent payments
• Utility bills (electricity, water, gas)
• Mobile phone plans (when not financed)
• Internet and cable services
• Insurance premiums
• Subscription services

What matters instead: While these payments don’t usually help your score when paid on time, they can definitely hurt it if accounts go to collections. Additionally, new specialty credit scoring models and services are emerging that allow renters and others to opt-in to having these payments reported.

Regional Variations and Emerging Trends

It’s worth noting some country-specific exceptions to this rule:

United Kingdom:

• The Rental Exchange initiative allows rent payments to be recorded on Experian credit reports
• Some utility companies report to credit bureaus through special programs

United States:

• Experian Boost allows consumers to add utility and phone payments to their Experian credit report
• Specialized rental reporting services can add rent history to credit reports for a fee

Australia:

• Comprehensive Credit Reporting now includes telecommunications and utility payment history for some providers

As credit reporting evolves, more of these regular payments may begin to influence scores, but for standard credit scoring models, they remain largely invisible unless they become delinquent.

5. Marriage, Divorce, and Your Spouse’s Credit

Your marital status and your spouse’s credit history generally don’t directly impact your personal credit score.

Separate Credit Histories

Important facts about marital status and credit:

• Getting married doesn’t merge your credit reports or scores
• Changing your name after marriage doesn’t affect your credit history
• Divorce itself doesn’t lower or raise your credit score
• Your spouse’s poor credit score doesn’t drag down yours

Each adult maintains their own credit identity, regardless of marital status. Credit reports are tied to individual Social Security Numbers/National Insurance Numbers, not households.

What matters instead: Joint accounts and co-signed loans do appear on both partners’ credit reports, and activity on these accounts affects both parties. During divorce, joint accounts that become delinquent will damage both individuals’ credit scores, regardless of who was assigned responsibility for the debt in the divorce agreement.

Couples planning their finances together can benefit from our Budget Planner to ensure all joint and individual obligations are met on time.

6. Where You Live and Demographics

Personal information about your location and background has no bearing on your credit score calculations.

Location Factors That Don’t Matter

These location-related factors don’t influence your score:

• Your address or postal code
• Whether you own or rent your home
• How often you move
• Country, state, or region where you reside
• Urban vs. rural location

Similarly, these demographic factors are never considered:

• Age (though length of credit history matters)
• Race or ethnicity
• Gender
• Religion
• National origin
• Marital status

In most countries, including such factors in credit scoring would violate anti-discrimination laws.

What matters instead: While your location doesn’t affect your score directly, different countries have different credit scoring systems. If you relocate internationally, you typically start building a new credit history in your new country, as credit histories don’t automatically transfer across borders.

7. Account Inactivity (With Some Caveats)

Simply not using a credit card or loan doesn’t negatively impact your credit score in most cases.

The Truth About Dormant Accounts

Not using a credit account:

• Doesn’t directly lower your score
• Doesn’t improve your score either
• May eventually lead to account closure by the lender

What matters instead: While inactivity isn’t negative in itself, there are some related considerations:

1. Closed accounts due to inactivity can impact your credit utilization ratio by reducing available credit
2. Cards with annual fees still require payment whether you use the card or not
3. Some lenders may close inactive accounts after 6-24 months of no activity

A strategic approach is to make small purchases occasionally on dormant credit cards and pay them off immediately. This keeps the account active while maintaining a low utilization ratio. Our Credit Card Repayment Calculator can help ensure you’re managing these accounts optimally.

8. Credit Counseling and Financial Education

Seeking professional financial advice or credit counseling doesn’t harm your credit score.

Getting Help Is Credit-Neutral

These financial education actions have no direct impact:

• Meeting with a credit counselor
• Attending financial literacy classes
• Using budgeting apps and tools
• Consulting with financial advisors
• Enrolling in financial education programs

What matters instead: While seeking advice doesn’t affect your score, the actions you take based on that advice might. For example, if credit counseling leads you to enter a debt management plan that negotiates lower payments, how the creditor reports this arrangement could potentially impact your score. However, the improvement in your overall financial health typically outweighs any temporary score fluctuations.

Our Debt Payoff Calculator can help you understand different approaches to debt reduction without impacting your credit score.

9. Interest Rates and Banking Fees

The cost of your credit doesn’t factor into your credit score calculation.

Cost Factors That Don’t Affect Your Score

These financial costs are irrelevant to credit scoring models:

• Interest rates on your credit cards or loans
• Annual fees on credit products
• Late payment fees (though late payments themselves do matter)
• Over-limit fees
• Balance transfer fees
• Foreign transaction fees

Whether you’re paying 0% or 29.9% interest on your credit card, the credit bureaus don’t consider this information when calculating your score.

What matters instead: While high interest rates don’t hurt your score directly, they can make debts more difficult to repay, potentially leading to higher balances, higher utilization ratios, or missed payments—all of which do affect your score. Use our Loan Calculator to understand how different interest rates affect your total payment amounts.

10. PayPal, Klarna, and Other Alternative Payment Methods

Many modern payment platforms and buy-now-pay-later services don’t report to credit bureaus.

The Credit Reporting Gap

These alternative financial services typically don’t influence your credit score:

• PayPal transactions (unless PayPal Credit is used)
• Venmo, Cash App, or Zelle transfers
• Many buy-now-pay-later services (though this is changing)
• Prepaid cards
• Debit card usage
• Mobile payment platforms (Apple Pay, Google Pay, etc.)

What matters instead: This landscape is rapidly evolving. Some buy-now-pay-later services have begun reporting to credit bureaus, and this trend may continue. Additionally, while normal use of these services doesn’t impact your score, if accounts become delinquent and go to collections, they will then appear on your credit report and damage your score.

The Changing Landscape

The credit reporting ecosystem continues to evolve, with more alternative data sources being incorporated into newer scoring models:

Experian Boost (US) now allows consumers to add positive payment history from:

• Netflix
• Disney+
• Utility bills
• Phone payments

UltraFICO (US) factors in banking activity like:

• Maintaining a savings cushion
• Avoiding negative balances
• Regular banking activity

PRBC (Payment Reporting Builds Credit) allows reporting of:

• Rent
• Utilities
• Phone bills
• Insurance

While mainstream FICO and VantageScore models still don’t incorporate most alternative payments, this may change as financial technology evolves.

Understanding Credit Score Impact: A Practical Framework

To help put all this information into perspective, consider this practical framework for assessing whether an action will affect your credit score.

Three Key Questions to Ask

When uncertain if an activity impacts your score, ask yourself:

1. Does this action involve borrowing money or repaying debt? If no, it likely doesn’t affect your score directly.
2. Is the company I’m interacting with a traditional lender (bank, credit card, loan provider)? If no, they may not report to credit bureaus.
3. Would this information help predict my future creditworthiness? Credit scoring models focus on behaviors that statistically correlate with future repayment behavior.

Using This Knowledge to Your Advantage

Now that you understand what doesn’t impact your credit score, you can:

• Focus your credit-building efforts on factors that actually matter
• Reduce unnecessary stress about financial activities that don’t affect your score
• Make more informed decisions about which financial behaviors to prioritize
• Detect misinformation when you receive advice about credit scores

Use our Credit Score Simulator to test how different actions might impact your score, focusing on the factors that truly matter.

Conclusion: Focusing on What Actually Matters

Understanding what doesn’t affect your credit score is just as important as knowing what does. By distinguishing between credit myths and facts, you can direct your energy toward the actions that genuinely improve your creditworthiness.

Remember that while items like your income, checking your own credit, savings accounts, and demographic information don’t impact your score directly, they may still be relevant to your overall financial health. Tools like our Budget Planner and Credit Utilization Ratio Calculator can help you maintain a balanced financial profile.

The most effective credit-building strategy focuses on the fundamentals that truly matter:

• Paying all obligations on time, every time
• Keeping credit card balances low relative to limits
• Applying for new credit only when necessary
• Maintaining a diverse mix of credit accounts
• Building a long history of responsible credit management

By understanding both what does and doesn’t affect your credit score, you can make more strategic financial decisions, avoid unnecessary worry, and build a stronger credit profile over time.