7 Credit Score Mistakes To Avoid

A bad credit score can affect many things you may want to do in your life. But what things do you do in your life that affects your credit score? Here are seven small mistakes you may be making that are hurting your credit report that you might not even know you're making.

1. Opening Too Many Accounts
Whenever you open a new credit card account, it generates what is called a hard inquiry. Each hard inquiry can cost your credit score 3-5 points and will stay on your report for two years.
2. Missing A Payment
While missing payments is an obvious mistake, even one missed payment can cause harm to your credit score. After one miss, you can see your report fall 100 points of more. However, if you had a good score to begin with, you can quickly rebound from this within 12 months.
3. Ignoring An Account That's In Collections
This is another mistake that can cause at least 100 points in damage to your credit score. If you leave a bill (whether cable, medical, etc.) in collections, it will negatively impact your score.
4. Maxing Out One Credit Card
It's never a good idea to bump against your overall credit limit since it affects your credit-to-debt utilization ratio (a ratio that measures how much credit you have at your disposal versus how much credit you're actually using). However, if you even owe over 33% of the available credit offered on one card, you can see your score negatively affected.
5. Not Checking Credit Score
Did you know 30-40% of credit scores have an error in them? Even if you don't use credit very often, an annual checkup can help you spot any mistakes and get them fixed quickly.
6. Closing An Old Account
You may think that getting rid of an account you don't need will help your score. But actually, it can have the opposite effect because it can lower that crucial credit utilization ratio.
7. Racking Up Your Bill Right Before a Statement Closes
Credit card issuers report two things: if you're up-to-date on all your payments and what your balance at the time is. By running up big purchases right before your statement closes (something that your issuer reports on), you could see a negative impact on your credit score.