December 5th, 2012

Credit Report Card Break-Down: Average Age of Open Credit Lines

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Credit Report Card Break-Down: Age of Open Credit Lines

Last time, we talked about how your percentage of on-time payments affects your credit. Before that, it was all about your open credit card utilization and how a high percentage can really ding your score. Today, we’re discussing another factor in your Credit Report Card: your average age of open credit lines.

Your credit history says a lot about you as a borrower. Of course, there’s whether or not you’ve made payments on time, but there’s also just how long your history is. In Credit Karma’s Credit Report Card, we take a look at the average age of your open credit lines, since many scoring models weigh newer credit lines more heavily.

How does my credit history length affect my credit?

Your credit history length is a significant factor in your credit score. Based on that, the average age of your credit cards is a strong indicator of your credit history. Basically, the longer that you’ve responsibly managed credit (like credit cards), the higher your credit score. Lenders and creditors can get a more thorough and accurate evaluation of your creditworthiness by looking at years and years of your credit use.

This is reflected in the score comparison charts you’ll see in your Credit Report Card.

average age of open credit lines

 

From this chart you can see that Credit Karma members with an average age of open credit lines at eight or more years also have an average credit score of 700, which is a good score. On the opposite end of the spectrum, members who have no credit history average out to a credit score of 554, which is in the poor range. In the middle, members averaging out to four to six years of history have a credit score of 679, which is good, but not great.

What can I do?

There’s no quick fix to make your credit history longer, but there are a few things you can keep in mind as you keep building your credit:

    1. When possible, keep old accounts open and in good standing. Unless your oldest credit card account is costing you money, keep it open and use it regularly. This will continue to lengthen the average age of your credit lines over time.
    2. Spread out credit card applications. You already know that you shouldn’t apply for a bunch of credit cards at once because of the hard inquiries the applications will initiate. But when you’re working on building your credit, it’s also important to spread out new applications because of the average age of your credit lines. As you’re adding new cards, leave at least a year of space between applications, especially if they’re your first few cards.

Have questions? Leave them in the comments section below. And stick around for more of the Credit Report Card Break-Down Series here on the Credit Karma Blog!

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Disclaimer: All information posted to this site was accurate at the time of its initial publication. Efforts have been made to keep the content up to date and accurate. However, Credit Karma does not make any guarantees about the accuracy or completeness of the information provided. For complete details of any products mentioned, visit bank or issuer website.

14 Comments

  1. My oldest credit card is the “worst” of all my cards. It has the lowest credit line and has no rewards or cash back at all. However, it is the prettiest.

    Wasn’t there an article posted here about how to transfer (or something like that) to a new card with rewards without losing the credit history of the account?

    Katherine at 10:37 am on December 10, 2012
  2. Hi, Katherine. My recommendation would be to keep the card open and active, but only with small purchases monthly. Get a nice rewards (cash back, I’d recommend) credit card for bigger credit purchases. You don’t need to show MORE activity on your older card, just SOME.

    bethy at 11:42 am on December 10, 2012
  3. Great, thanks!

    Katherine at 10:35 am on December 17, 2012
  4. Hi, Bethy! Tell me please, if my Friend has 8 Credit Cards include 1 Secured Card and1 Macy’s Card – Can he just will close last two? How it can affect him credit score?

    John at 12:29 am on January 2, 2013
  5. This is a great question, but also difficult to answer because there are other factors. Depending on the balances on your friend’s other credit cards compared with his overall credit limits, his score will be affected. However, it sounds like these last two cards might be the worst of the bunch, so it could be a good idea to close. Have your friend ask his question in the Credit Advice Center of Credit Karma: http://www.creditkarma.com/all/advice where he can really describe the situation. Also remember that no one can tell you exactly how a change like this can affect your credit – so he shouldn’t expect a specific point range, just an idea.

    bethy at 1:14 pm on January 2, 2013
  6. I understand how longer average age will help. So for instance if I had a credit line that just opened for a directed purpose and I am already finished with it, will closing that newest credit line help my credit score by removing that newest age or will it hurt by forever freezing a “3 month” age into the average?

    Scott at 10:43 am on June 13, 2013
  7. How is the “average” account age calculated? My oldest open account is 31 Yrs and 7 Mos. Newest open Account is 0 Yrs 6 Mos. My Average Account age is 6 yrs 11 Mos. I have had many, many accounts, loans, mortgages, lines of credits, etc. opened and paid off over the last 30 years. How is the “average” calculated? Would it help if I “close” my newest accounts?

    Susan at 12:47 pm on June 23, 2013
  8. Jenna

    Hi Susan, the average account age is all of your open accounts’ ages added together divided by the number of accounts you have. If you have any specific questions about your account, please email support@creditkarma.com. Thanks!

    Jenna at 4:04 pm on June 25, 2013
  9. Interesting survey!

    SMS kredīts at 6:03 am on July 9, 2013
  10. How do I calculate the age of my accounts? I have one that is about 11 years old, two more that are five, another that’s four, and recently opened up five more because I was told it would help me in buying a house with a good APR. However, when I went to apply for a preapproval letter, I was told the age of my accounts were WAY too young. Based on what I’ve read, four years seems to be acceptable. Now I need to find out how to calculate the age of all my accounts so I know when to go back out and start looking again. With car payment, department store, general use, and healthcare credit cards I have fourteen that show up on my report.

    Christeen at 11:26 am on April 17, 2014
  11. This is to clarify what I had just wrote. I have a total of fourteen revolving/installment accounts. Two are installmemt and the rest are either dept. store cards or general use cards (Visa, Mastercard, Barclay, Discover, etc. type of cards). The oldest is a Chase card opened in 2005, 2 charge cards in 2009, then my car payment which I opened in 2010, and within the last years or so I opened the rest of them (most in the last few months).

    Christeen at 11:37 am on April 17, 2014
  12. I have a now inactive Discover card which was opened over 20 years ago, always in good standing. My daughter’s name is now on it too. If I closed this account, how would it effect my credot score?

    Pat Barrett at 12:44 pm on June 25, 2014
  13. Mike

    Thanks for the question, Pat. To find more information, I’d suggest checking out this article: https://www.creditkarma.com/article/ClosingOldAccount

    Thanks again!

    Mike at 3:03 pm on June 25, 2014

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