7 Credit Card Myths That Can Hurt Your Credit Score

By Melanie Lockert
August 5, 2019
Chime is a financial technology company. Banking services provided by The Bancorp Bank or Stride Bank, N.A.; Members FDIC

Getting a credit card can be a rite of passage into adulthood. It’s a way to help build your credit, earn rewards, and manage your financial lifeYet, given all the credit card myths floating around, it can be confusing to understand how a card can impact your credit score. So, we’ve done our part to get to the bottom of these myths so that you’ve got the facts. 

Read on to learn 7 common credit card myths that can hurt your credit score.

Myth #1: Credit cards are a direct path to debt

One of the most pervasive myths for people who are debt-averse is that credit cards will automatically lead to debt. While you certainly can incur debt if you don’t pay your credit card balance in full each month, the cards themselves are not synonymous with debt. 

For instance, it’s important to stay on top of due dates and only charge what you can afford. In addition to this, making your payments on time and in full can prevent you from getting into debt with credit cards. 

Here’s something else you should know: Credit cards can actually improve your credit score when used responsibly. This means paying your bills on time and in full each month, and keeping your balances low. Also, you should pay attention to your credit utilization, or how much you charge on your credit card. It’s typically recommended to keep your balances below 30 percent of your credit limit. Believe it or not, sticking to this 30 percent credit utilization figure can actually help your credit score. 

Myth #2: Checking your credit score can lower it  

Your credit score is a number that illustrates how good of a borrower you are. It shows your “creditworthiness” and tells lenders how responsible you are with payments. 

As a consumer, you’ll want to check your credit score to know where you’re at. Yet, there’s a myth that checking your credit score can lower it. 

Not exactly. There’s a difference between a “soft pull” and “hard pull” on your credit. Only “hard pulls” affect your credit. Hard pulls happen when you actually apply for credit or loans. Soft pulls are typically for checking credit. So, when you check your credit score on a site like Credit Karma, it won’t affect your credit score. 


Here’s something else you should know: Check your credit score and check it often.


Checking your credit score is part of being a financially responsible consumer. You can check your credit score on free sites like Credit Karma, and you can check your credit report at AnnualCreditReport.com. Information in your credit report is used to determine your credit score, so make sure everything is accurate. 

Pro tip: Making credit payments on time and keeping balances low have the biggest impact on your credit score. Taking these two steps will help improve your credit score

Myth #3: You need to carry a consistent credit card balance

One of the most common and harmful credit card myths is that you need to carry a balance to improve your credit. Not true.

Carrying a balance on a credit card may lead to debt, but it will also affect your credit utilization. So no more asking “When should I pay my credit card?” because you think a balance is a good idea. Pay the balance by the due date! 


Here’s something else you should know: You should use your card regularly and pay it off every month. 


To be a responsible credit card user, it’s best practice to pay your cards on time and in full each month. While credit card rewards can incentivize spending, make sure you’re mindful of what you’re charging and how much you’re spending. Keep tabs on your spending and only charge what you can afford so that you can focus on paying off credit cards in full each month. 

Myth #4: You should cancel credit cards you’re no longer using

You often hear that you should cancel services you no longer use. Credit cards are not like that. 

If you no longer use your credit card, you shouldn’t automatically cancel it. Why? Because when you cancel it, you’ll limit your credit utilization and it can affect your length of credit history. And this can cause your credit score to go down.


Here’s something else you should know: Keep lines of credit open, even if you’re not using them. 


Keeping your accounts open can positively impact your credit score. While there are some reasons you’ll want to cancel a card, make sure you evaluate this decision carefully.

Myth #5: You should only have one credit card

Some people think that having multiple credit cards will hurt your credit score. For this reason, you may think it’s better to have just one card. That’s not true. 

It’s more important that you use your cards wisely. For example, if you have a high credit limit among all of your credit cards but keep your balances low, this can help your credit score. On the other hand, if you max out all of your cards, you may be considered a risk to credit card issuers.


Here’s something else you should know: Multiple cards can be a good choice. Instead of worrying about how many credit cards you have, focus on your credit utilization and payment history. If you keep your balance low on all of your credit cards and focus on paying off credit cards in full and on time, you can use this to your advantage. 

Myth #6: Opening a new credit card account will significantly lower your credit score 

You might think that opening a credit card account will hurt your credit score. Not necessarily. 

Opening a new credit card account will result in a “hard pull” on your credit report, which can result in a small drop in your credit score. But, you can quickly get that score back up. So, don’t be scared of opening a new account. 


Here’s something else you should know: Opening a new card may affect your other major purchases.


In general, opening a new credit card doesn’t have a major impact on your credit score. However, if you’re looking to get a mortgage, having too many credit inquiries may have a negative impact on your credit. So, be mindful of that fact when deciding the timing of opening new credit card accounts. 

Myth #7: You should never accept a credit limit increase

In some cases, your credit card issuer may offer you a credit limit increase. You may be hesitant because you think it will lead to more debt and hurt your credit score. This isn’t always the case.

When used the right way, a credit limit increase can help your credit score. How? Because an increase in available credit can lower your credit utilization. This, in turn, may actually boost your credit score. 


Here’s something else you should know: If you’re already maxing out your credit cards, avoid increasing your credit limit. 


Getting a credit limit increase can be useful if you pay off your cards on time and keep your balances low. However, if you’re already maxing out your cards and struggling to pay back your balance, you’ll want to hold off on getting a credit limit increase. 

Look at your spending and be honest. If a credit limit increase is too much temptation to spend, don’t do it. 

It’s time to ditch these credit card myths

As you can see, there are many damaging credit card myths out there. Hopefully we’ve busted these 7 myths to help you answer those burning questions like: “ Should I pay off my credit card? ” or “ Is carrying a balance a good idea? 

As you’ve learned here, it’s important to look at the facts instead of the myths. This will help you truly understand how your credit cards can impact your credit score.

And remember: Being a responsible credit user is key. You can do this by keeping your balances low and making payments on time.  

This page is for informational purposes only. Chime does not provide financial, legal, or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for financial, legal or accounting advice. You should consult your own financial, legal and accounting advisors before engaging in any transaction.

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Melanie Lockert is the founder of the blog and author of the book, Dear Debt. Her work has appeared on Business Insider, Time, Huffington Post and more. She is also the co-founder of the Lola Retreat, which helps bold women face their fears, own their dreams and figure out a plan to be in control of their finances.

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