If you’ve ever applied for a loan, credit card, or even tried to rent an apartment, chances are your FICO credit score played a role in the decision. But what exactly goes into this three-digit number that has so much influence over your financial opportunities?

FICO scores range from 300 to 850, with higher numbers signaling stronger creditworthiness. What many people don’t realize is that this score isn’t random—it’s built from five key categories, each with its own weight. Let’s break them down.

1. Payment History (35%)

This is the single most important factor in your score. Lenders want to know if you’ve consistently paid your bills on time. Late payments, defaults, bankruptcies, or accounts sent to collections all hurt your score. On the flip side, a long track record of on-time payments builds a strong foundation.

Takeaway: Pay every bill on time, every month. Even one missed payment can leave a mark for years.

2. Amounts Owed (30%)

Also called credit utilization, this measures how much of your available credit you’re using. If your credit cards are maxed out, lenders may see you as risky—even if you pay on time. Ideally, you want to keep your balances below 30% of your credit limits, and lower is even better.

Takeaway: Manage your balances wisely and avoid carrying high debt loads.

3. Length of Credit History (15%)

Your score rewards consistency and longevity. A longer credit history gives lenders more data to judge how reliable you are. This includes the age of your oldest account, newest account, and the average age across all your accounts.

Takeaway: Don’t rush to close old accounts, even if you don’t use them much—they help lengthen your credit history.

4. Credit Mix (10%)

Lenders like to see that you can handle different types of credit responsibly. This could include a credit card, an auto loan, a mortgage, or a student loan. You don’t need every kind of credit, but a healthy mix can give your score a small boost.

Takeaway: A variety of accounts looks better than relying on just one type of credit.

5. New Credit (10%)

Every time you apply for credit, a “hard inquiry” shows up on your report. Too many inquiries in a short period can make lenders worry you’re desperate for credit. Opening several new accounts at once also lowers your average account age, which hurts your score.

Takeaway: Be strategic about applying for new credit—space out applications and only open accounts you truly need.

Why This Matters

Your FICO score is a snapshot of your financial reliability. By understanding the five factors—payment history, amounts owed, length of credit history, credit mix, and new credit—you can make smarter decisions to build and protect your score.

Remember, improving your credit score is less about quick fixes and more about consistent habits. Pay on time, keep balances low, let your accounts age, and be careful with new credit. Over time, these small steps add up to big results.