Takeaways
- Credit age is the average length of credit history for all open credit accounts.
- Credit age is a variable in the "credit history" category in credit score models.
- Credit age can only be increased by keeping existing credit accounts open.
- Closing accounts can negatively impact your credit age and credit score.
- Only opening a limited number of high-impact credit cards, personal loans, or auto loans can impact your credit mix and make it more likely to increase your credit age.
Getting a high credit score is considered one of many consumers' top personal finance goals. Credit scores, like the FICO or VantageScore, are generated from your credit report and give lenders a scoring system to determine your eligibility for different credit products.
Credit scores can affect what policies or services you are offered, from cell phone companies to home insurance providers and even traditional installment loans. The higher your credit score, the better deals, terms, and products you get access to.
Credit history is a significant component of getting a great credit score. Here’s how it works.
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What Is Credit Age?
The length of your credit history is also known as your credit age. It refers to the average age of your credit accounts and is the standard measure for how long you have been using credit facilities. It is calculated by averaging the ages of all open credit accounts.
Lenders like to see longer credit histories because they give them more data points to determine your financial reliability. An older credit history shows that you have experience managing credit, which is generally seen as a positive factor when applying for a new credit card, personal loan, auto loan, or mortgage.
Your credit score is one of your credit profile's more critical financial metrics. While it is calculated using a variety of data points from your credit report, credit age can be an influential variable in ensuring you get the credit score you need.
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How Credit Age Affects Credit Score
Many people start signing up for credit cards when they reach the minimum age of 18. The earlier you sign up for credit accounts, the more you can impact your credit age. Whether you have had a credit account open for three months or six years influences your credit history and credit score.
A higher credit age shows experience successfully managing credit over long periods. A longer credit age and history gives lenders and creditors more confidence regarding your borrowing and repayment behavior.
Closing old accounts can reduce your average credit age, and opening new accounts will also reduce your average. Maintaining older accounts in good standing can help raise your credit score by increasing your credit age.
What Is Credit History?
Credit length is the amount of time a single credit account has been active. Lenders tend to favor borrowers with a longer credit history because it demonstrates they can manage debt effectively. On the other hand, if you have a shorter credit history, your credit score is likely to be lower. By making on-time payments, you can increase your credit score and length of credit history.
The longer your credit history, the more data points lenders can use to assess what credit products you are eligible for. In general, the longer your credit history, the better your credit score. This is particularly important because it shows your stability and reliability in handling credit that has been extended to you.
Smart Tip:
In your FICO credit score, credit history accounts for 15% of your score.
5 Other Factors Affecting Credit Scores
Credit history is only one piece of the puzzle for those trying to improve their credit score. Other credit-related variables have an enormous impact on your credit score. Here are five to focus on:
1. Payment History
Payment history is the most influential factor in determining your credit score, accounting for about 35% of your FICO total score.[1] It reflects your track record of consistently making on-time payments for accounts like credit cards, auto loans, and mortgages.
Constantly paying your bills on time shows lenders that you are a highly reliable borrower. This reduces your default risk and positively impacts your credit score. Conversely, late or missed payments will lower your score and can live on your credit report for years.
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2. Credit Utilization
Credit utilization is the ratio of your current outstanding debt relative to your total credit limit. Credit utilization is a critical factor in your overall score, making up about 30% of the total calculation. Try Smart Money’s credit utilization calculator below to see where you stand:
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Credit Card Balance & Limits
Your Credit Usage
Overall Credit Utilization
Great work! Your credit utlization is less than 30%. Keep your utilization low by making ontime payments.
Wait! A credit utlization over 30% can damage your credit score. Keep your utilization low by making ontime payments or increase your limits.
Lenders typically want to see a credit utilization of 30% or less (read more about the 30% rule). A credit utilization below this threshold demonstrates you are managing your credit effectively.
High utilization can be a sign of financial distress and can work against your credit score. Keeping your balances low relative to your credit limit is one key to maintaining a solid credit score.
3. Amounts Owed
Banks and credit unions look for borrowers with very high credit accounts and owe substantial amounts of money to lenders. High debt levels can indicate that you have overextended yourself and might be unable to pay off debt.
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4. Credit Mix
Your credit mix refers to the variety of credit accounts you have. A diverse credit mix—credit cards, personal loans, mortgages, and auto loans—demonstrates that you can manage multiple different types of credit responsibly, which indicates financial maturity and stability.
Having a healthy mix of accounts can help boost your credit score, but you shouldn’t open accounts solely to try and improve your credit mix. Instead, focus on managing your accounts responsibly because a diverse credit mix only helps when combined with a solid payment history.
5. New Credit Applications
New credit applications contribute 10% to your credit score, which, while comparatively minor, still has an impact. This metric reflects how many accounts you have recently opened and how many hard inquiries have been conducted on your behalf.
It would be best to be thoughtful about when and what credit accounts you open. For example, sporadically opening a bunch of credit cards can damage your credit score. A rapid number of new credit applications can signal you are taking on too much debt.
However, depending on the scoring model, if you have several hard inquiries conducted within a 14 or 15-day period, this might be treated as a single inquiry. This behavior is usually seen when you shop interest rate shopping for a mortgage.
Learn More: 13 Tips on How to Save for a Down Payment While Renting
Smart Summary
Credit age is the average length of credit of all your open credit accounts. It is a vital piece of the puzzle used to calculate your credit score and has significant ramifications for getting a high credit score. You can increase the strength of your credit age by keeping account balances open and making on-time payments. Be thoughtful when you close accounts you don’t use anymore, and make sure you will use credit lines you open.
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Frequently Asked Questions
No. Keeping old, unused credit card accounts open can help lengthen your credit age and improve your credit history. Pruning old credit products can be a good idea if you have too many to manage effectively. (Read about how to automate your finances).
The average American has roughly four credit cards, car loans, mortgages, and other credit products. It is not so much about how many credit products you have as how you manage your monthly payments and debt-to-income ratio.
While opening a new credit line can bring down your credit score, it can also boost it in other ways. For example, applying for a new credit card will also increase your credit limit, a key component of your credit utilization.
(1) MyFICO.com. What’s in my FICO Scores? Last Accessed January 14, 2025.
