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Understanding the 5 Credit Score Factors (And Where to Focus First)

Not all credit factors carry the same weight. Of the five: History, Usage, Length, Mixture, and New Credit. Three make up 80% of your score. So don’t try to fix everything. Focus on what actually moves the needle.

Whether you’re buying a home or just want better rates, knowing where to start can save you time and stress. Let’s break them down, and I’ll show you simple, low-cost ways to improve each one.

History: Credit Factor 35%

This is the heaviest hitter in your credit score. 35% of your score is based on payment history. That means lenders care most about one thing: Do you pay on time?

Why most people miss payments:

It usually boils down to two things:

1. Cash flow issues – You don’t have enough coming in to cover what’s going out.

2. Forgetting – You thought autopay was set up. It wasn’t.

Systems Fix Stress

Set yourself up with simple, low-effort systems that save you from surprise dings:

• Phone reminders – Create recurring monthly to-dos for each credit card. Your iPhone can set a monthly reminder.

• Autopay fail-safes – Even if autopay is on, use reminders as a backup.

• Spending alerts – Most cards let you set balance alerts at custom thresholds so you catch rising balances early. I would set it at 75% of your monthly spending budget, so you know when to ease off.

Pro Tip with Chat GPT Prompt - Cash Flow Math (Copy Text Below)

I have uploaded my bank statements for multiple months. Can you analyze the transactions to calculate the total deposits and total withdrawals for each month? Then, compute the average deposits and withdrawals across all months to give me a clearer picture of my cash flow trends.

Usage - Credit Factor 30%

Usage accounts for 30% of your credit score and is influenced by how much of your available credit you are using. Aim to keep your credit usage under 30% of your credit limit. I've noticed this is the fastest way to increase your credit score, but sometimes the hardest.

💳 Tip #1: If You CAN Pay Off Your Balances – Use Strategic Timing

One of the biggest hacks to raise your credit score quickly. If you’re fortunate enough to be in a position to pay off your credit cards. It's all about timing.

You might think that paying your cards in full every month automatically gives you a 0% usage. But here’s the catch: credit bureaus typically receive your balance before your payment due date. That means even if you pay everything off when your statement is due, a high balance might still get reported.

Pro Tip: Look up your credit card’s statement closing date, not just the due date. Then, aim to pay down your balance a few days before that date. This ensures a lower balance is reported to Experian, Equifax, and TransUnion.

💳 Tip #2: If You CAN’T Pay Off Your Balances – Ask “How Can I…?”

Now, what if you’re in the much more common position of not being able to pay your balances down completely? That’s okay, you're not alone. Here's a mindset shift: rather than seeing your situation as stuck between two bad options (pay late or keep high balances), start with a "How can I…" brainstorming session.

Ask yourself (and your partner, if applicable):

“How can we both stay current on our payments and find ways to reduce balances?”

Take 20 minutes, jot down every idea. No matter how small, crazy, or impossible it may seem at first. That might include:

• Picking up a few overtime shifts or freelance gigs

• Selling unused items on Facebook Marketplace (hello, pandemic gym gear!)

• Temporarily adjusting your paycheck withholdings (with help from a CPA) to increase cash flow

• Pausing subscriptions or expenses that aren’t mission-critical

This exercise isn’t about perfection. It’s about momentum. A single $1,000 balance drop can save you $200 in interest per year at 20% APR. Stack those small wins, and you build real progress.

Pro Tip with Chat GPT Prompt - Credit Usage Math  (Copy Text Below)

I have uploaded my credit card statement(s). Can you analyze the transactions and categorize the expenses by type? Once categorized, calculate the total spending and percentage for each category to identify where the majority of my expenses are. The goal is to measure and gain insight into my spending habits to improve financial management. Here are the expense categories I would like you to use: Housing, Utilities, Food, Transportation, Student Loans, Car Loans, Other Debt Payments, Entertainment, Shopping, Travel, Fitness, Wellness, Education, Childcare, Bank Fees, Late Fees.

Length - Credit Factor 15%

This one’s simple, but often overlooked. The longer your accounts have been open (and in good standing), the better. It shows lenders you’re consistent.

What not to do:

Don’t close your oldest accounts. Especially if they’ve got a clean history. Even if you’re not using them, they’re doing work behind the scenes.

If that old card has been chillin’ in your drawer for years, let it keep chillin’. Maybe toss a Spotify subscription on it once a year just to keep it active. Then autopay and forget about it.

If you're starting from scratch:

If you’re new to the U.S. or recently graduated, here are two solid ways to start building credit history:

• Secured credit card – You put down a deposit (say $300), and that becomes your limit. It’s training wheels for your credit file.

• Use the AMEX Global Transfer Program
  Have an AMEX abroad? You may be able to transfer your credit history to a U.S. card. It’s one of the rare ways to start with a credit file, not from scratch. Just apply, get approved, and your history comes with you.

• Become an authorized user – Ask someone with great credit (and trust in you) to add you to their card. You don’t need to use it, but you get the benefit of their length and payment history.

Mixture - Credit Factor 10%

Mixture is like your credit portfolio’s greatest hits album. It makes up 10% of your score.
Lenders want to see that you can manage different types of debt: credit cards, car loans, mortgages, student loans, etc.

But here’s the deal… Don’t game the system:

Don’t open a random personal loan just to diversify. That’s like adding a tambourine to your playlist hoping it wins you a Grammy. Not necessary. If you already have a credit card and maybe an auto loan, you're probably covered. Focus your energy where it counts ( history + usage).

New - Credit Factor 10%

This last factor is all about what’s new on your credit file. Every time you open a new account or someone pulls a hard inquiry (think credit cards, car loans, mortgages), it dings your score just a bit.

What matters:

• Hard inquiries = Slight dip, especially if you rack up a few in a short span.

• Soft inquiries (like checking your own score or pre-qualifying for a loan) = No effect.

My Rule:

Avoid opening multiple accounts back-to-back unless it’s part of a bigger plan (like buying a home). One card to consolidate high-interest debt? Cool. Three cards in a weekend because of rewards points? Not so much.

Small steps, big score,

Nathan