Jean Chatzky
Exactly how your credit score is calculated may seem complex — and maybe even mysterious. But when you break it down into smaller (and less complicated) pieces, it can help remove the mystery, which can enhance your ability to build and maintain a solid score.
What is Credit Age?
Let’s tackle credit age, which is one of the factors used to calculate your credit score and is used by everyone from lenders to landlords to help determine your creditworthiness. Two of the most common credit scoring models, VantageScore and FICO, both take the length of time you’ve had credit into account, though each measures it a little differently.
Unpacking Credit Age for VantageScore
Credit age makes up 21% of VantageScore.*
How Credit Age is Calculated
According to VantageScore:
- Depth of credit looks at the age of your open or active credit accounts, plus the average, oldest, and youngest account ages.
- Older accounts tend to help boost a VantageScore because they offer more insight into how you manage your finances over time.
If you opened a credit card five years ago, you would have a longer credit age (or a thicker credit file) than someone with a credit card for only a year.
Other Considerations
The depth of credit category, notes VantageScore Solutions, also considers the type of credit accounts a person maintains. The two main credit types are:
- Revolving (such as credit card accounts)
- Installment debt (a car payment or mortgage)
Demonstrating that you can handle both types of credit is likely to bump up your score more than just having a single type of credit on your reports.
Unpacking Credit Age for FICO
Credit age makes up 15% of your FICO Score, where FICO calls this factor Length of Credit History.
How Credit Age Is Calculated
According to FICO, this factor looks at:
- Age of your oldest account. The longer it’s been open, the more it helps.
- Average age of all your accounts. Opening several new accounts at once can pull this number down, even if your oldest account doesn’t change.
- How long it’s been since your accounts had activity, not just how old they are.
FICO needs an account open for about six months with recent activity before it can fully score this factor. If you’re new to credit, that’s the window you’re building toward.
Other Considerations
Here’s where the two models split. VantageScore folds account type into its credit age calculation. FICO does not. FICO scores account type separately, under a factor called Credit Mix, so for FICO, credit age is purely about time: how old your accounts are and how long you’ve used them.
How to Improve Credit Age
In many cases, the longer you have had credit, the better. This means that younger people with no credit card accounts or other types of credit can find it challenging to wait for their credit age to mature, so to speak.
Patience as a Strategy
Credit age is one of the few areas where doing less can improve your score. Patience isn’t passive — it’s strategic restraint that allows your profile to strengthen naturally over time. Each month that passes, without opening new unnecessary accounts or closing old accounts:
- Your average age of credit increases
- Your credit profile gains stability
- Your risk profile decreases in a lender’s view
Patience has a compounding effect on your credit age. Credit scoring rewards stability, longevity, and consistency. These are all patience-driven attributes.
Become an Authorized User
If you have younger credit, joining an established account can boost your score. Often, parents add their children or a spouse adds their partner as an “authorized user” on an older credit card account to help give them a longer credit history. If this is something you’re considering, it’s important to:
- Make sure that the account holder checks with the issuer to confirm credit usage is being reported to the three major credit scoring bureaus: Experian, Equifax, and TransUnion.
- If the card issuer does not report to the bureaus, becoming an authorized user on that card defeats the purpose and won’t help you improve your credit age.
A note on FICO: FICO excludes authorized user accounts from this factor entirely. If your only accounts are ones where you’re an authorized user rather than the primary holder, FICO has nothing to calculate your credit age from. Building your Length of Credit History with FICO specifically requires an account opened in your own name.
Apply for a Secured Credit Card
Fortunately, a variety of lenders now offer what’s known as a secured credit card account to those with little or no credit to help them build up their file so they can eventually qualify for better rates on loans and other credit products.
How to Get a Secured Card. To obtain a secured credit card:
- Deposit money with the issuing institution as collateral.
- Once you get the card, use it at least once a month and then pay it off in full every month.
- This is where patience comes into play again. By following this plan consistently, in 18 or 24 months, you should be able to transfer to a traditional credit card.
Don’t Close Old Accounts
Closing an old account can hurt your credit score. Older accounts are the foundation of credit age, so closing an old account deletes all the credit age and history you’ve built. If that older account has an annual fee that you don’t want to pay anymore, there is a way to maintain credit age without a fee.
- Annual Fee. If you are paying an annual fee and want options:
- Call your credit card company, card issuer, or financial institution
- Explain that you’ve been a long-time customer and want to maintain the credit history built, but don’t want to pay an annual fee.
- Ask about the options available to remain a customer. You may be able to move to a different card with a lower fee or no fee at all.
- And remember, the answer is always no if you don’t ask!
With reporting by Casandra Andrews
*based on VantageScore 3.0
