Does Not Using My Credit Card Affect My Credit Score?

Not using your credit card doesn't automatically harm your credit score, but it can indirectly lead to negative consequences if not managed carefully. Understanding how credit scoring models work is key to maintaining a healthy financial profile.

Understanding Credit Scores

Your credit score is a three-digit number that lenders use to assess your creditworthiness. It's a crucial component of your financial health, influencing your ability to secure loans, mortgages, rental agreements, and even certain job opportunities. In 2025, credit scores continue to be a primary indicator of financial responsibility, with most lenders relying on the FICO and VantageScore models. These scores typically range from 300 to 850, with higher scores indicating lower risk to lenders.

Several factors contribute to your credit score. The most significant ones, according to the FICO model, include:

• Payment History (35%): This is the most critical factor. It reflects whether you pay your bills on time. Late payments, defaults, and bankruptcies can significantly damage your score.
• Amounts Owed (30%): This refers to your credit utilization ratio – the amount of credit you're using compared to your total available credit. Keeping this ratio low is vital.
• Length of Credit History (15%): The longer you've had credit accounts open and in good standing, the better.
• Credit Mix (10%): Having a mix of different types of credit (e.g., credit cards, installment loans) can be beneficial, though this is a less impactful factor.
• New Credit (10%): Opening too many new accounts in a short period can negatively affect your score, as it may signal increased risk.

In 2025, the emphasis on responsible credit management remains paramount. Lenders are increasingly sophisticated in their risk assessment, making a strong credit score more valuable than ever. Understanding these components is the first step to ensuring your credit health, even when you're not actively using a particular credit card.

How Credit Cards Impact Scores

Credit cards are a double-edged sword when it comes to credit scores. When used responsibly, they are powerful tools for building and improving your credit history. However, mismanagement can lead to significant damage.

Building Positive Credit History

The primary way credit cards help build your credit is by providing a consistent record of on-time payments. When you use a credit card for purchases and pay your balance in full and on time each month, you are actively demonstrating to lenders that you are a reliable borrower. This positive payment history is the single most important factor in credit scoring models.

Furthermore, credit cards contribute to your credit utilization ratio. By having a higher total credit limit across all your cards, you can maintain a lower utilization ratio, which is generally viewed favorably by scoring models. For example, if you have a total credit limit of $10,000 and you've only used $1,000 of it, your utilization is 10%, which is excellent.

The length of your credit history also benefits from having credit cards. Older, well-managed accounts demonstrate a longer track record of responsible borrowing, which positively impacts your score.

Potential Pitfalls of Credit Card Usage

Conversely, credit cards can severely damage your credit score if not handled with care.

• Missed Payments: Even a single missed payment can have a detrimental effect, especially if it's 30 days or more past due. Late fees are a minor inconvenience compared to the long-term damage to your credit score.
• High Credit Utilization: Carrying high balances on your credit cards significantly increases your credit utilization ratio. If you're using more than 30% of your available credit, it can negatively impact your score. Exceeding 50% is considered high risk.
• Overspending and Debt: The ease of swiping a credit card can lead to overspending and accumulating significant debt. High levels of debt can make it difficult to manage payments and can signal financial distress to lenders.
• Opening Too Many Cards: While a good credit mix is beneficial, opening numerous credit cards in a short span can trigger "hard inquiries" on your credit report, which can temporarily lower your score. It can also make you appear desperate for credit.
• Closing Old Accounts: Closing older credit card accounts, especially those with no annual fee, can reduce your average age of accounts and decrease your total available credit, potentially increasing your credit utilization ratio.

In 2025, the principles remain the same. Responsible credit card usage is about balance and discipline. It's about leveraging the benefits of credit without falling into the traps of debt and mismanagement.

The Myth of Inactivity: Does Not Using Your Card Hurt?

This is where many consumers get confused. The direct answer to "Does not using my credit card affect my credit score?" is nuanced. Simply leaving a credit card in a drawer and not touching it for months or even years doesn't inherently lower your score, provided other factors remain positive. However, the indirect consequences of not using a card can indeed impact your creditworthiness.

Credit scoring models are designed to reward responsible credit management. Inactivity itself isn't a negative mark. What *can* be negative are the downstream effects of that inactivity. Let's break down the common misconceptions and the reality.

Misconception 1: Inactivity Automatically Closes Accounts

While some credit card issuers may close accounts due to prolonged inactivity (often after 12-24 months of no transactions), this is an issuer policy, not a direct scoring model rule. If an issuer closes your account, it can indirectly affect your score by:

• Reducing your total available credit: This can increase your credit utilization ratio if you have balances on other cards.
• Decreasing the average age of your credit accounts: If the closed account was one of your oldest, removing it can lower the average age, which is a scoring factor.

However, the act of the account being closed *by the issuer* doesn't immediately tank your score unless it significantly impacts your utilization or average age of accounts.

Misconception 2: An Unused Card Is a "Bad" Card

An unused card isn't inherently bad. It can even be beneficial if it's an older account with a good payment history and a high credit limit, as it contributes positively to your credit utilization and average age of accounts. The problem arises when its inactivity leads to other issues.

The Reality: Indirect Impacts

The core of the issue lies in how inactivity can lead to situations that *do* negatively affect your credit score.

• Zero Activity = No Positive Reinforcement: Credit scores are built on positive behavior. If you never use a card, you're not demonstrating responsible usage to the credit bureaus. While this isn't a direct penalty, it means that card isn't actively *helping* your score.
• Potential for Issuer-Initiated Closure: As mentioned, issuers may close inactive accounts. This is a significant indirect impact.
• Missed Opportunity for Credit Building: If you're trying to build or improve your credit, an unused card is a missed opportunity. You could be using it for small, manageable purchases and paying them off to demonstrate consistent positive activity.
• Forgetting About Fees: Some cards, even if unused, might have annual fees. If you forget about these fees and they go unpaid, they can result in a delinquency, which *will* negatively impact your score. This is a critical point for 2025 financial planning.

Therefore, while not using a credit card doesn't trigger a direct "penalty" in your credit score calculation, it can pave the way for actions or oversights that do. The key is proactive management.

Factors Affected by Non-Usage

When you don't use a credit card, several components of your credit report and score can be indirectly influenced. Understanding these specific impacts is crucial for making informed decisions about your credit management strategy in 2025.

Credit Utilization Ratio

This is perhaps the most significant factor that can be indirectly affected. Your credit utilization ratio is calculated by dividing the total balance you owe across all your credit cards by your total available credit limit across all cards.

Scenario 1: You have only one credit card, and you stop using it.

• If the card has a zero balance and no annual fee, its inactivity doesn't directly impact your utilization ratio.
• However, if the issuer eventually closes the account due to inactivity, your total available credit will decrease. If you have balances on other cards, your utilization ratio will then increase, potentially lowering your score.

Scenario 2: You have multiple credit cards and stop using one.

• If the unused card has a zero balance, it continues to contribute to your total available credit, which is good for your utilization ratio.
• The risk arises if the issuer closes the inactive card. This reduces your total credit limit, and if your balances on other cards remain the same, your overall utilization ratio will rise. For instance, if you had $20,000 in total credit and $5,000 in balances (25% utilization), and an inactive card with a $5,000 limit is closed, your total credit drops to $15,000. Your utilization then jumps to 33.3% ($5,000 / $15,000), which is a less favorable number.

In 2025, maintaining a credit utilization ratio below 30% (and ideally below 10%) is a widely recommended best practice for optimal credit scores.

Average Age of Credit Accounts

Credit scoring models favor longer credit histories. The average age of your credit accounts is calculated by taking the average of the age of all your open credit accounts.

When a credit card issuer closes an account due to inactivity, that account is typically removed from your credit report after a certain period (usually 7-10 years, depending on the type of account and the reason for closure). However, while it's still on your report, its removal from the "open accounts" calculation will decrease the average age of your open accounts.

For example, imagine you have three credit cards:

• Card A: Opened 10 years ago
• Card B: Opened 5 years ago
• Card C: Opened 1 year ago (and you stopped using it)

The average age of your open accounts is (10 + 5 + 1) / 3 = 5.33 years.

If Card C is closed by the issuer, and it's removed from your open accounts calculation, your average age becomes (10 + 5) / 2 = 7.5 years. This *increases* the average age, which is good. However, the *initial* impact of closure is that the account is no longer contributing to the "open" average. If Card A (the oldest) were closed, the average age would drop significantly. The key is that closing an older account, regardless of its usage, can negatively impact this metric.

The length of your credit history is a significant factor in your credit score, and reducing the average age of your accounts can lead to a lower score.

Credit Mix

Having a variety of credit types (e.g., credit cards, installment loans like mortgages or auto loans) can be a positive factor, although it's less impactful than payment history or utilization.

If your only form of credit is credit cards, and an issuer closes one due to inactivity, it doesn't fundamentally change your credit mix. However, if you have a diverse credit profile and an inactive credit card is closed, it doesn't harm your credit mix. The impact here is minimal compared to other factors.

New Credit

The "New Credit" category in scoring models relates to recent credit applications and newly opened accounts. Not using a credit card has no direct impact on this factor. You are not applying for new credit, and no new accounts are being opened.

Payment History (Indirectly)

As discussed earlier, the most significant indirect impact on payment history occurs if you forget about an annual fee or other charges on an inactive card. If these go unpaid, they can lead to late payments, delinquencies, and ultimately, a severely damaged credit score. This is a critical oversight to avoid in 2025.

For example, if you have a credit card with a $95 annual fee and you haven't used the card in a year, you might forget about the fee. If it's charged and not paid, it can quickly lead to a delinquency.

In summary, while inactivity itself isn't penalized, the potential for account closure, increased credit utilization, and forgotten fees can all indirectly harm your credit score.

When Not Using a Card Might Be Beneficial (and how to mitigate risks)

While the general advice is to manage credit cards actively, there are specific scenarios where not using a credit card might be a strategic choice. However, it's crucial to implement risk mitigation strategies to avoid negative consequences.

Scenario 1: You Have Too Many Cards

Some individuals accumulate numerous credit cards over time, leading to potential overspending temptations, confusion about due dates, and a higher risk of forgetting about smaller accounts. In such cases, strategically closing or letting some cards go inactive can be beneficial.

Risk Mitigation:

• Identify "Keeper" Cards: Focus on keeping your oldest cards, those with no annual fees, and those offering the best rewards or benefits for your spending habits.
• Monitor for Annual Fees: If an inactive card has an annual fee, consider closing it or making a small, planned purchase to keep it active and avoid the fee if the card offers significant benefits that outweigh the fee.
• Maintain Overall Utilization: Ensure that your remaining active cards have low balances to keep your overall credit utilization ratio low.
• Avoid Closing Oldest Accounts: If you decide to stop using a card, try to keep your oldest, most established accounts open, even if they are inactive, as they contribute positively to your credit history length.

Scenario 2: You Want to Simplify Your Finances

Managing multiple credit cards can be overwhelming. If you find yourself struggling to keep track of payments or rewards, consolidating your spending onto one or two primary cards can simplify your financial life.

Risk Mitigation:

• Automate Payments: Set up automatic minimum payments on any inactive cards you decide to keep open to prevent missed payments and associated fees.
• Periodic Small Purchases: Make a small purchase (e.g., a cup of coffee, a streaming service subscription) on the inactive card every few months and immediately pay it off. This keeps the account active and demonstrates responsible usage.
• Set Calendar Reminders: If you don't automate payments, set calendar reminders for all your credit card due dates.

Scenario 3: The Card Has High Fees and Few Benefits

Some credit cards come with high annual fees and offer minimal rewards or benefits that don't justify the cost. If you're not using such a card, it's often best to close it.

Risk Mitigation:

• Pay Off Any Balance: Ensure the balance on the card is zero before closing it.
• Consider the Impact on Utilization: If closing this card significantly reduces your total available credit and increases your utilization on other cards, weigh the cost savings against the potential credit score impact. You might consider keeping it open with a zero balance if it has a high credit limit.
• Check Issuer Policies: Understand if closing the card will affect any other accounts you have with the same issuer.

Scenario 4: Protecting Against Fraud

In rare cases, some individuals might choose to stop using a card if they've experienced significant fraud with it in the past and are concerned about future security breaches, even after the issuer has replaced the card.

Risk Mitigation:

• Monitor Statements Regularly: Even for inactive cards, it's prudent to check statements periodically for any unauthorized charges.
• Set Up Transaction Alerts: Many issuers allow you to set up alerts for any transaction, regardless of the amount, which can provide immediate notification of fraudulent activity.
• Use a Small, Active Card for Subscriptions: If you have recurring subscriptions, consider linking them to a card you actively monitor and manage, rather than an inactive one.

In 2025, the overarching principle is proactive management. Even if a card is inactive, it requires attention to ensure it doesn't inadvertently harm your financial standing.

Strategies for Managing Inactive Cards

Effectively managing credit cards you don't actively use is key to preventing them from negatively impacting your credit score. These strategies focus on maintaining account health and avoiding common pitfalls.

Strategy 1: Make Small, Planned Purchases Regularly

This is the most recommended strategy for keeping a credit card active without accumulating debt.

How it works:

1. Identify a small, recurring expense that you can easily afford, such as a monthly subscription (e.g., Netflix, Spotify), a small grocery item, or a coffee.
2. Charge this recurring expense to the inactive credit card.
3. Set up automatic payments for the full statement balance of that card to ensure it's paid off on time every month.

Benefits:

• Keeps the account active, preventing the issuer from closing it due to inactivity.
• Demonstrates positive payment history to credit bureaus.
• Helps maintain the average age of your credit accounts.
• Ensures your total available credit remains high, which is beneficial for your credit utilization ratio.

In 2025, this simple habit can be a cornerstone of maintaining a strong credit profile.

Strategy 2: Monitor for Annual Fees and Other Charges

Some credit cards have annual fees, and others might have inactivity fees or other less obvious charges. Forgetting about these can lead to unexpected debt and delinquencies.

How to implement:

• Review Statements: Even if you don't use the card, review its statement at least once every few months.
• Check Cardholder Agreement: Refer to your cardholder agreement or the issuer's website to understand all potential fees associated with the card.
• Set Calendar Reminders: If the card has an annual fee, set a reminder a month before it's due to ensure you have funds available or can decide whether to keep the card.

If an inactive card has a high annual fee that you don't feel is justified by its benefits, consider closing it. However, be mindful of the impact on your credit utilization and average age of accounts.

Strategy 3: Keep Older, No-Annual-Fee Cards Open

Older credit accounts with a history of responsible use are valuable assets for your credit score. If these accounts do not have an annual fee, it's generally advisable to keep them open, even if you don't use them frequently.

Why this is important:

• Length of Credit History: These cards contribute to the average age of your credit accounts, a significant scoring factor.
• Available Credit: They add to your total available credit, helping to keep your credit utilization ratio low.

To keep them active and prevent issuer closure, use Strategy 1: make a small, recurring purchase and pay it off automatically.

Strategy 4: Understand Issuer Policies on Inactivity

Credit card issuers have varying policies regarding account closure due to inactivity. Some may close accounts after 12 months of no activity, while others might wait 24 months or longer.

What to do:

• Contact the Issuer: If you're unsure about an issuer's policy, contact their customer service.
• Proactive Management: Don't wait for the issuer to close the account. Implement Strategy 1 to keep it active.

Strategy 5: Consider Closing Cards with High Annual Fees or Low Utility

If a credit card has a high annual fee that you're not recouping in rewards or benefits, or if it offers no significant advantage over your other cards, closing it might be a sensible decision.

Steps to take:

• Pay off the balance: Ensure the balance is zero.
• Notify the issuer: Inform the issuer you wish to close the account.
• Assess the impact: Before closing, consider how it will affect your credit utilization ratio and average age of accounts. If it's an old account with a high limit, closing it might be detrimental. In such cases, consider keeping it open and inactive but monitored.

In 2025, a balanced approach is key. Don't hoard cards unnecessarily, but also don't close them without considering the potential credit score implications.

Alternative Credit Building Methods

While credit cards are a primary tool for building credit, they are not the only option, especially for individuals who may not qualify for a traditional credit card or prefer alternative methods. In 2025, the landscape of credit building is more diverse than ever.

Secured Credit Cards

A secured credit card requires a cash deposit upfront, which typically serves as your credit limit. This deposit reduces the risk for the lender, making them more accessible to individuals with no credit history or poor credit.

How they work:

• You provide a security deposit (e.g., $200 to $500).
• You receive a credit card with a limit equal to your deposit.
• You use the card for purchases and pay the bill on time.
• The issuer reports your payment activity to the credit bureaus, helping you build a positive credit history.

After a period of responsible use (typically 6-12 months), many issuers will review your account and may refund your deposit, potentially converting the secured card to an unsecured one.

Credit-Builder Loans

These are small loans specifically designed to help individuals build credit.

How they work:

• You borrow a small amount of money (e.g., $500 to $1,000).
• The loan amount is held in a savings account by the lender.
• You make regular payments on the loan over a set period.
• Once the loan is fully repaid, the lender releases the funds to you.
• Your payment history on the loan is reported to the credit bureaus.

This method ensures you build credit while also saving money.

Rent and Utility Reporting Services

Traditionally, rent and utility payments have not been included in credit reports. However, several services now allow you to report these consistent payments to credit bureaus.

Examples of services:

• Experian Boost: Allows you to add utility and telecom payments to your Experian credit report.
• Rent Reporters, LevelCredit, etc.: These services aggregate your rent payments and report them to one or more credit bureaus.

While not all scoring models incorporate these payments equally, they can provide a boost, especially for individuals with limited credit history. It's important to note that late payments on utilities or rent can still negatively impact your credit if reported.

Authorized User Status

Becoming an authorized user on someone else's credit card can help you build credit, provided the primary cardholder manages the account responsibly.

How it works:

• A primary cardholder adds you to their existing credit card account.
• Your name appears on the account, and its history (including payment history and credit utilization) is often reflected on your credit report.

Important Considerations:

• Primary Cardholder's Behavior is Key: If the primary cardholder misses payments or carries high balances, it will negatively impact your credit score.
• Issuer Reporting: Not all issuers report authorized user activity to credit bureaus, and not all scoring models weigh it heavily.

This method is best used with a trusted individual who has an excellent credit history.

Co-signing a Loan

Co-signing a loan means you agree to be responsible for the debt if the primary borrower defaults.

How it works:

• The loan activity (payments, delinquencies) will appear on your credit report.
• Responsible repayment by the primary borrower will help build your credit.

Risks:

• If the primary borrower misses payments, it will severely damage your credit score.
• The loan will count towards your debt-to-income ratio, potentially affecting your ability to qualify for other credit.

Co-signing should only be done for individuals you trust implicitly and for whom you are prepared to take on the financial responsibility.

In 2025, a combination of these methods, alongside responsible credit card management, can create a robust credit-building strategy.

Expert Advice and 2025 Insights

As we navigate 2025, credit scoring continues to evolve, but the core principles of responsible financial management remain constant. Experts emphasize a proactive and informed approach to credit, especially concerning the nuances of credit card usage.

The "Set It and Forget It" Fallacy

Many financial advisors warn against the "set it and forget it" mentality when it comes to credit cards, particularly those you don't use regularly. The primary concern is not the inactivity itself, but the potential for oversight.

"Leaving a credit card unused can lead to a false sense of security," says Sarah Chen, a certified financial planner. "Consumers might forget about annual fees, automatic renewals of subscriptions, or even issuer-initiated closures. These oversights can have a tangible negative impact on their credit score, which they didn't anticipate."

Focus on Credit Utilization and Age of Accounts

The two most critical factors for credit scores – payment history and credit utilization – are where inactive cards can cause indirect harm.

Credit Utilization: "Your total available credit is a powerful tool," explains David Lee, a credit scoring analyst. "If an issuer closes an inactive card, especially one with a high credit limit, it reduces your total available credit. This can instantly increase your credit utilization ratio, even if your spending on other cards hasn't changed. For 2025, keeping utilization below 30% is crucial, and below 10% is ideal."

Age of Accounts: "Older accounts demonstrate a longer track record of responsible credit use," notes Lee. "Closing older cards, even if inactive, can lower the average age of your credit history, which is a scoring factor. It's often better to keep an older, no-annual-fee card open and make a small purchase every so often."

The Power of Small, Consistent Activity

The consensus among experts for 2025 is that the best way to manage inactive credit cards is to keep them active with minimal, controlled usage.

"A small, recurring charge – like a streaming service or a monthly utility bill – that is automatically paid in full each month is the perfect strategy," advises Chen. "It keeps the account active, demonstrates consistent positive behavior, and ensures you don't forget about it. It's a low-effort, high-reward approach to credit management."

When to Consider Closing a Card

While keeping cards open is often beneficial, there are times when closing is the right move.

• High Annual Fees: If the annual fee outweighs the benefits and you're not using the card, closing it can save you money.
• Poor Customer Service or Rewards: If the card issuer provides subpar service or the rewards program is unappealing, and it's not an old, valuable account, closing it might be an option.
• Reducing Temptation: For individuals who struggle with overspending, closing a card can be a form of self-discipline.

However, even when closing, experts advise considering the impact on credit utilization and average age of accounts. If the card has a high credit limit and is one of your oldest, consider keeping it open with a zero balance and minimal activity instead of closing it.

2025 Credit Trends to Watch

Beyond credit card management, several trends are shaping the credit landscape in 2025:

• Increased Use of Alternative Data: More lenders are exploring the use of non-traditional data (like rent and utility payments) to assess creditworthiness, especially for thin-file consumers.
• AI in Credit Decisions: Artificial intelligence is playing a larger role in credit scoring and loan underwriting, leading to more sophisticated risk assessments.
• Focus on Financial Wellness: There's a growing emphasis on financial education and wellness programs, encouraging consumers to manage their credit proactively.

In conclusion, the question "Does not using my credit card affect my credit score?" is best answered by understanding that while inactivity itself isn't penalized, the consequences of inactivity can be detrimental. Proactive management, strategic usage, and a clear understanding of how credit scoring models work are essential for maintaining a healthy credit score in 2025 and beyond.

Conclusion

The question of whether not using your credit card affects your credit score is a common one, and the answer is nuanced. While inactivity alone doesn't directly lower your score, the indirect consequences can be significant. Failing to manage inactive cards can lead to their closure by the issuer, which in turn can reduce your total available credit, thereby increasing your credit utilization ratio. This, along with the potential for forgotten annual fees leading to delinquencies, can negatively impact your creditworthiness.

In 2025, the most effective strategy for managing credit cards you don't use regularly is to keep them active with minimal, controlled spending. Making small, recurring purchases and ensuring the balance is paid in full and on time each month is a low-effort, high-reward approach. This practice helps maintain your credit utilization, preserves the age of your credit accounts, and prevents issuer-initiated closures. Prioritizing older, no-annual-fee cards for this strategy is particularly beneficial for long-term credit health.

Ultimately, maintaining a strong credit score requires ongoing vigilance and informed decision-making. By understanding the factors that influence your score and implementing smart management strategies for all your credit accounts, you can ensure your credit remains a powerful asset.