People have all kinds of beliefs about money. Some financial ideas come from notions that family members or friends put into your head. You might also learn about some of them from internet articles, TV shows, or other sources.

Whatever you think you know, whether it involves paying off debt beliefs, the best way to save money, or anything else, you should think carefully about where you heard it and how reliable you consider that source. If you got financial advice from your unemployed uncle at Thanksgiving, that’s hardly something you should view as the gospel truth.

With that in mind, let’s talk about a few common myths that can cause your credit score to take a hit. You need to watch over your credit score, and believing these falsehoods could send it in the wrong direction.

What is Your Credit Score?

First, let’s ensure you understand what we mean when using the term “credit score.” Your credit score is a number that predicts the likelihood that you will pay back a loan or act in a certain way financially. Many institutions will look at your credit score before they decide whether to grant you a loan. A landlord might look at your score when determining whether or not to rent you an apartment.

Generally, your score will fall anywhere between 300 and 850. With a higher score, you’ll be in a better position to rent an apartment, get a car loan, etc.

Now, let’s talk about myths that can harm your score by causing it to drop.

1. A Credit Check Doesn’t Impact Your Score

This is sometimes true, but not always. What’s known as a “soft pull” will not cause your score to drop. A “hard pull” will harm it, though.

A soft pull is what happens when an entity like a credit card company does something like check your credit to see if you qualify for an exclusive offer. A hard pull, by contrast, happens when a financial institution, such as a bank, checks your credit to see whether they should grant you a loan.

The occasional hard pull does lower your score, but it won’t do too much damage. You just don’t want to make a habit of it.

2. Closing a Credit Card Doesn’t Hurt Your Score

This is false. Closing out a credit card account will cause your credit score to lower. The reason is that part of how your score is generated comes from how much credit you’re utilizing. Your capacity to have more credit that you’re not using keeps your score high.

If you close out a card, that causes your amount of available credit to drop. With less available credit, your credit score will drop as well. Similar to what happens when you do a hard pull, though, you can always rebuild your credit after closing out a card account.

3. It’s Good to Have a Balance on a Credit Card

This notion is also incorrect. You’ll always have a higher credit score if you have no balance on your open credit card accounts. If you’re not able to have no balance, you want to carry as little money on your credit card accounts from one payment period to the next as you can.

Be Aware of These Myths

The better you understand what’s factual and what’s a myth regarding a credit score, the better positioned you will be to keep your score as high as possible. Try not to carry balances on your open credit card accounts. Leave your credit cards open, since closing them out will negatively impact your score. Also, try not to do too many hard credit checks. Soft ones are okay.

These practices will keep your credit score in good shape. If you see your score drop, though, don’t panic. You can always take steps to rebuild it.