Six Money Mistakes That Won't Hurt Your Credit Score

worried lady with phone and laptop - credit scoreAlthough there are a lot of ways you can seriously harm your credit score, not every financial misstep comes back to haunt you. Although a single missed payment can drop your score by 100 points, read on to discover several slip-ups that will have little, if any, impact. Mind you, we don't advise any of these, but if you're trying to get your credit health back on track, you can breathe a sigh of relief that your mistake won't set back your efforts.1. Maxing Out Your Small Business Credit Cards. Thankfully, this isn't nearly as bad as maxing out a personal card, according to John Ulzheimer, president of consumer education for Here's why: "Almost none of them report to your personal credit report," Ulzheimer says. Of course, this only holds true if the account is in good standing; if you go delinquent, that's going to show up on your credit report. You can call your card issuer and ask, or check your report and see if any business cards are represented there. Ulzheimer says Capital One tends to report business cards under your personal credit profile, but he adds, "I haven't seen any other examples."

2. Switching Jobs. Switching employment frequently won't ding your score. (It might make you look like a flighty employee, which is a problem in and of itself, but it doesn't touch your FICO score one bit.) Since many employers will check your credit report as part of the hiring process (which we've discussed here), it does behoove you to check your report before applying, though.

3. Neglecting to Establish an Emergency Fund. The same article also points out that while not having an emergency fund isn't good for your peace of mind or your long-term fiscal health, it won't have any impact on your score as long as you're managing to make your credit card or loan payments from month to month. Keep in mind, though, if you have any kind of unforeseen expense, you could wind up not having enough money to pay your bills, which would then impact your credit score.

4. Writing Bad Checks. While this type of action will almost certainly get you in trouble, it won't necessarily hit your credit report. Bounced checks get documented in a database called Chex Systems, but that isn't connected to any of the three reporting bureaus or your credit report. If you bounce checks with any regularity, you might find it difficult to open a new checking account, though. Also, if the party to whom you wrote the bad check takes you to collections over it, that action will show up in your credit file.

5. Taking a Loan From Your 401(k). "Borrowing from your 401(k) is a bad idea, but it won't have any impact on your credit score," says Ulzheimer. While it is a loan, of course, you're technically borrowing from yourself so it doesn't put a damper on your credit score.

6. Not Paying Your Taxes. This is a really, really bad idea for numerous reasons, but unless you're so delinquent that the IRS has slapped a lien on your personal property, it's not going to show up on your credit score, says Ulzheimer. If you owe back taxes, contact the IRS to set up a payment plan before it files a claim against your home, car or other possessions.
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