What It Means
Length of credit historyCredit historyThe record of how you've handled credit over the years, as shown on your credit reports: which accounts you've had, for how long, and whether you paid on time. See more is how long you've had credit, as scoring models read it from your credit reportCredit reportA record of how you've borrowed and repaid, kept by credit bureaus and sold to lenders, landlords, insurers and others who decide whether to deal with you. See more. myFICO says FICO ScoresFICO scoreA credit score made by the company FICO from your credit report; base FICO Scores, including the widely used FICO Score 8, run from 300 to 850. See more look at the age of your oldest account, the age of your newest account and the average age of all your accounts. It makes up 15% of a FICO Score. A longer history generally helps, but myFICO says it isn't required for a good score.
Try It: Work Out the Average Age of Your Accounts
Type how many years each account has been open. Put 0 for a slot you don't use. The starting ages are an example.
A new account starts at zero, so it pulls the average down and resets your newest account.
Tick the box to see what one new card does to the average.
How People Say It
- "Don't close your oldest card, it helps your credit age."
- "My average age of accounts dropped after I opened two cards."
- "I'm only 22, so my history is short."
The Breakdown
A short example. Rosa has four cards, aged 12, 6, 3 and 1 years, so her average account age is 5.5 years. In one month she opens a new store cardStore credit cardA credit card offered by a retailer, either usable only at that store or co-branded with a card network, often with store discounts and a higher APR. See more for a discount and closes her 12-year-old card because she never uses it.
| Accounts | Average age |
|---|---|
| Her four cards, before any change | 5.5 years |
| Plus one new card at 0 years | 4.4 years |
Where it goes wrong. The new card starts at zero, which pulls the average down and makes her newest account brand new, both things myFICO says FICO looks at. Closing the old card does less than she fears in the short run: Experian says a closed account in good standing can stay on the report for up to 1010,000 stepsA popular daily step goal that began as the name of a 1960s Japanese pedometer; later studies find health benefits begin well below it. See more years and keeps counting toward account age while it's there. The new application also adds a hard inquiryHard inquiryA check of your credit report by a lender after you apply for credit; it shows on your report for up to two years and can lower some scores a little. See more.
What to watch for
- Open new accounts when you need them, knowing each one lowers your average age for a while.
- Think twice before closing your oldest account: once it drops off the report, up to 10 years later per Experian, a younger account becomes your oldest.
- Remember that length is 15% of a FICO Score, while payment historyPayment historyThe record in your credit reports of whether you paid each credit account on time, late or not at all; it's about 35% of a FICO Score. See more is 35%.
Good to Know
The weights are myFICO's figures for the general population, and it says how much each factor matters depends on your own credit profile. Other scoring models, such as VantageScoreVantageScoreA credit scoring model from the company VantageScore; version 4.0 runs from 300 to 850 and gives payment history the most weight, at 41%. See more, group account age differently. Keeping older accounts paid on time and in good standing is the part of this you control.
FAQ
What is a good length of credit history?
There's no set cutoff. myFICO says a longer history is generally positive for FICO Scores but isn't required for a good score.
Does closing a credit card shorten my credit history?
Not right away. Experian says a card closed in good standing can stay on your report for up to 10 years and keeps counting toward the age of your accounts until it drops off.
Does opening a new card lower my average age of accounts?
Yes. A new account starts at zero, so your average falls, and myFICO says FICO also looks at the age of your newest account.
Do It in Buhata
Bills, Reminders
With Plus, keep your oldest cards in Bills with their due dates so they stay paid on time and in good standing as they age.
Open BuhataRelated Terms and Categories
- Credit history
The record of how you've handled credit over the years, as shown on your credit reports: which accounts you've had, for how long, and whether you paid on time.
- Credit score
A three-digit number calculated from your credit report that lenders use to judge how likely you are to repay; common models run from 300 to 850.
- FICO score
A credit score made by the company FICO from your credit report; base FICO Scores, including the widely used FICO Score 8, run from 300 to 850.
- Credit mix
The variety of credit types on your report, such as cards, retail accounts, installment loans and a mortgage; it makes up 10% of a FICO Score.
- Hard inquiry
A check of your credit report by a lender after you apply for credit; it shows on your report for up to two years and can lower some scores a little.
- Authorized user
A person the cardholder lets carry and use a card on their credit card account, without being legally responsible for the bill.
Sources
myFICO, "How Credit History Length Affects Your FICO Score"; myFICO, "How are FICO Scores Calculated?"; Experian, "How Long Do Closed Accounts Stay on Your Credit Report?"
- www.myfico.com/credit-education/credit-scores/length-of-credit-history
- www.myfico.com/credit-education/whats-in-your-credit-score
- www.experian.com/blogs/ask-experian/when-are-closed-accounts-deleted
Last updated .