Let's Talk Credit Score Credit doesn't have to be a mystery. Five factors determine your score. Here's what you should know about them. Credit Scores. Just three simple digits can impact so many areas of your life. Your credit score is designed to rate how well you manage credit - sort of a risk assessment for doing business with you. But sometimes it doesn't seem that simple to understand. It doesn't have to be a mystery. Just five factors determine your score, and you can start today to take action toward improving your score.Click here to download this infographic. Head to the Next Door Tools Library to get more financial tools. Read the full description of the infographic See transcript for description of the infographic. Let's talk credit. Credit doesn't have to be a mystery. Five factors determine your score. Here's what you should know about them. Payment History, 35%: Do you pay your bills on time? Tip: Always pay the minimum payment due on time. Sign up for automatic payments, which usually involves linking the credit card to a bank account, and schedule payments ahead of time to avoid late payments. Credit Utilization Ratio, 30%: How much of your credit have you used? Total Balance/Total Limit = Credit Utilization Ratio Tip: Consider asking for a credit limit increase to lower your utilization ratio (but be careful if you struggle to manage spending on your cards!) Length of Credit History, 15%: How long have you had credit? Tip: If you already have credit cards, try to keep your oldest accounts open. Consider putting a recurring charge on the credit card to keep it active (but be sure to pay it off on time). Credit Mix, 10%: Do you have different types of credit? There are two types of credit: Installment: Has an end date (think loans)Revolving: Has no end date (think credit cards)Tip: Don't worry if you don't have any installment accounts today. These will likely come with time as you buy a car, home, or take out loans. Credit Inquiries, 10%: How often is your credit report accessed? There are two types of inquiries: Hard inquiry: impacts your score (a lender pulls your credit score)Soft inquiry: doesn't impact your score (you pull your own credit score)Tip: Set calendar reminders to pull credit reports from AnnualCreditReport.com once every 4 months to monitor credit throughout the year. Save the report as a PDF when you're done! What are Next Door® Tools?Next Door financial education tools are designed to make financial concepts approachable and inspire progress toward your financial well-being. Subscribe to Next Door to get Financial education tools and articles delivered to your inbox.Subscribe to Next DoorLive in Chicago? Next Door offers free, in-person education at their store-front community space and caf� in the Lincoln Park neighborhood in Chicago. Stop by for a one-on-one coaching session, community class or a coffee. Visit Next Door to learn more.