Credit cards are one of the most widely used financial tools, but they are often misunderstood. Here are some common credit card myths debunked to help you use your credit more effectively.

• Myth 1: Carrying a Balance Improves Your Credit Score: Many believe that keeping a balance on their credit card helps build credit. In reality, carrying a balance only results in interest charges. Your credit score benefits more from paying off the full balance each month and keeping credit utilization low.
• Myth 2: Closing Old Credit Cards is Good for Your Score: While it might seem like closing old, unused credit accounts could simplify your finances, it can actually hurt your credit score. Closing an account can reduce your overall available credit, increasing your credit utilization ratio and potentially shortening your credit history.
• Myth 3: You Need to Use a Credit Card Every Month: It’s not necessary to use your credit card every month to build credit. As long as the account is open and in good standing, it contributes positively to your credit history. Occasionally using your card for small purchases and paying them off promptly is sufficient.
• Myth 4: Checking Your Credit Score Lowers It: Checking your own credit score is considered a soft inquiry and does not affect your score. It’s a good practice to regularly monitor your credit to track your progress and catch any errors or fraudulent activity.

By understanding these myths and managing your credit cards wisely, you can maximize the benefits and minimize the drawbacks of credit card use.