How Do Deactivated Checking Accounts and Debit Cards Affect Your Credit Score?

If you want to stay on top of your credit, it’s important to know how your actions affect your credit score. You might be thinking about ditching your current checking account or debit card for something better, and wonder how it affects your credit. Perhaps you’ve already closed your checking account and want to know if it’s had an impact at all on your credit score. 

Read on to learn what affects your credit score and how deactivated checking accounts factor into it. 

credit score

Deactivated checking account, debit card and credit score 

Your credit score is a three-digit number that shows lenders your creditworthiness. For example, it shows how likely you are to pay back your bills and how responsible you are as a borrower. That number comes from information in your credit report. 

Your credit report is chock full of information about your credit history and includes your personal information. Your bank information, however, is not included in your credit report. 

Your credit overviews how many loans you’ve taken out and what you borrow — aka your credit — so your personal income, banking, and savings are not included in your credit report. 

If you deactivate your checking account or debit card, it won’t affect your credit score. However, it’s important to stay on top of the key factors that contribute to your score.

What affects your credit score? 

Your deactivated bank accounts don’t negatively affect your credit score, but this also means that your active bank account information doesn’t necessarily help your score either. 

There are other factors that affect your credit score. Credit refers to what you borrow, so your student loans, credit cards, car loans, etc. have an impact on your credit score. 

When it comes to the loans you take out, there are five factors that make up your credit score: 

1. Payment history (35%)

2. Amounts owed (30%)

3. Length of credit history (15%)

4. Credit mix (10%)

5. New credit (10%)

Your payment history makes up the largest part of your credit score and refers to whether you make payments on time or not. The amounts owed refers to your credit utilization ratio which compares how much you owe against your credit limit. It’s a good idea to keep your balances at less than 30% of your credit limit. If your credit limit is $1,000, for example, you want to have less than $300 on your credit card at any given time. 

The length of credit history refers to how long you’ve had your accounts open. This is just a time-based factor so be mindful of closing accounts for lines of credit, like a credit card. Credit mix examines the types of credit you have, such as credit cards and student loans which are a mix of revolving credit and installment loans. New credit refers to how many new lines of credit you open, so be careful about applying for too many lines of credit in a short time period. 

Getting the most out of your bank accounts and credit 

Now you know that deactivated checking accounts and debit cards don’t have an impact on your credit score. Although you don’t have to worry about a credit score drop, you’ll want to build a strong credit profile. 

If you’re looking for a new checking account and debit card, make sure you check for fees and any restrictions. Online banks like Chime, Ally, and Capital One 360 could be good options to consider. 

For credit accounts, make sure to make payments on time and consider enrolling in auto-pay if you know your checking account won’t overdraft by doing so. Through auto-pay, you connect your checking account to your credit accounts to automatically make payments so you’ll never miss a due date. 

The key is to be mindful of how you use your financial products and make sure you keep your checking account managed and your credit in good shape. 

Questions on your credit score? Schedule a free 20-minute consult call with a member of our Warm-Up Call Team!

The Financial Gym Team