While you can pay off debts immediately and open new accounts to raise a score, there is one category of the FICO formula takes a long time to build: the length of your credit history. A long credit history takes years and even decades to build, and you can ruin that by opening new accounts.
Identification
The FICO model counts the length of your history of managing credit for 15 percent of your score, according to the Fair Isaac Corp. While the formula is complex and no set number is considered ideal, in general, the longer the history, the better.
Longer Not Always Better
Sometimes, shorter histories improve your score, because the FICO formula actually has 10 formulas for use with different types of borrowers. The FICO model reserves one formula for new borrowers. This means that someone can have a very high score early in their borrowing history and see a sudden drop because they get lumped in with people who have experience managing credit once their credit profile matures. In comparison, the borrower looks worse when compared to people who have had excellent credit for years.
The Intangibles
The length of your credit history affects your score in more ways than the hard calculation. Borrowers with elite scores -- over 800 -- usually have a credit history that spans several decades, according to MintLife. Managing credit for decades means the borrower probably has excellent knowledge about handling debt and more time to accumulate good history and accounts.
Tip
Avoid opening new accounts whenever possible or maintain long gaps between new accounts. The FICO model averages the age of your accounts to arrive at the length of your credit history in addition to your oldest account. Also, do not cancel accounts unless you have a good reason, such as annual fees. Closing an accounts means it stops building history and remains on your report for 10 years after the date of most recent activity.
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