How to Protect Your Credit Score in Retirement

A retired couple walk in the rain.
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Retirement is the time to put your feet up and enjoy the fruits of your labor. But that doesn’t mean you should let your guard down and completely neglect your finances.

While retirement doesn’t directly affect your credit health, how you manage your money during this stage of your life can impact your creditworthiness and ability to access loans or credit cards in the future.

How to Protect Your Credit Score in Retirement

Let’s explore a few strategies to help you maintain a healthy credit score in your golden years.

Keep Your Credit Accounts Active

According to a survey by the credit bureau TransUnion, one-third of older adults are “reducing their reliance on credit cards — behavior that may actually result in account closures and credit score reductions” in an effort to simplify their finances and reduce the number of logins to track.

However, while relying on just one or two credit cards is simple and convenient, closing cards that have been open for a long time will reduce your average credit age and harm your score.

To keep your credit score safe from the red zone, Certified Financial Education Instructor Thomas Maluck advises you to “let your older cards stick around, even if you only use them for one purchase a year to keep it active.”

And if you want to get rid of a credit card with an annual fee, Maluck said you should “call the credit card company to get a product change that will turn it into a no-fee card but still carry the years from the previous card.”

Freeze Accounts When Not in Use so They Cannot Be Abused 

To protect your credit score in retirement, Maluck recommends that you freeze your accounts that are not in use. Doing so places a temporary lock on them, making it almost impossible for scammers and hackers to steal your identity or funds.

“It’s hard to exploit an account that’s on ice, and unfreezing it is relatively simple when you’re the account owner,” Maluck said.

So if you haven’t already, contact your financial institution to see what steps to take.

Check Your Credit Reports 

Negative items on your credit report can hurt your credit score, even if they’re inaccurate. So, to  keep a pulse on your credit health in retirement, check your credit report regularly. Under the Fair Credit Reporting Act (FCRA), you’re entitled to request a free copy of your credit report from each of the three major credit bureaus at If you notice any negative items that shouldn’t be there, file a dispute immediately with the credit bureau to correct the information.

Keep Your Credit Utilization Low

Your credit utilization measures how much of your available credit you’re using, accounting for about one-third of your overall credit score. For example, if you have a $5,000 credit limit and a $1,000 balance, your credit utilization is 20%.

If your credit utilization is too high, it indicates to future lenders you’re overextended and potentially risky to lend to. Most financial experts advise maintaining a low credit utilization to keep your credit score in check during retirement. And while 30% is acceptable, a 10% or single-digit credit utilization ratio is ideal.

Automate Your Debt Payments 

Your payment history accounts for a whopping 35% of your credit score. Even if you’ve only missed a few payments, that information could remain on your credit reports for seven years from the original delinquency date. So, make sure to automate your payments to avoid forgetting them while you’re living it up on a cruise ship (or just going about daily life) in retirement.

The exact process of setting up automatic payments can be slightly different depending on the creditor. But in general, you’d log into your creditor’s website and navigate to the payments section. From there, choose the amount you’d like to pay each month and the date you want payments to be deducted. You may also set up an automatic payment through your bank. Check with your creditor or financial institution for more details.

Pitfalls to Avoid to Maintain Your Creditworthiness

Knowing what pitfalls to avoid can help you maintain a healthy credit score and avoid unnecessary financial stress during your golden years.

Opening Too Many New Lines of Credit

In retirement, you may want to renovate your home to make it more conducive for aging in place. However, Maluck says this is where many retirees fall for the pitfall of opening excessive new lines of credit.

“A hardware store may offer a line of credit on a furniture purchase that sounds convenient, but it can torpedo your credit score in a couple of ways,” he said. “First, that new line of credit drags down the average age of credit. Second, that line of credit is maxed out and therefore appears as 100% utilization to the credit bureaus.”

To avoid this pitfall, consider other options before opening new lines of credit and avoid maxing out any of them.

Co-Signing Loans

You should be extra careful about co-signing loans during your retirement years. While it may seem like a benevolent gesture, co-signing comes with its fair share of risks. If your friend or family member misses payments or defaults on the loan, you’re on the hook and are responsible for making payments to avoid hefty penalties. And if you fail to repay the loan, you could damage your credit score and your chances of obtaining credit in the future.

To avoid this pitfall, be cautious about co-signing loans for friends and family. Especially if you know they have a history of missing payments and defaulting on loans. Don’t feel pressured to co-sign a loan just because of your relationship with the person asking you for the favor. There’s nothing wrong with prioritizing your own financial security and putting yourself first when your retirement savings are at risk.

Falling for Scams 

Unfortunately, scammers often target seniors who are unfamiliar with their deceptive tricks (although scammers can trick anyone). Scams can come in many forms, from phone calls promising a windfall to fraudulent websites designed to steal your financial information.

To avoid falling victim to identity theft or other scams, stay vigilant and question any suspicious requests from people you don’t know. Always double-check the legitimacy of the caller, website, or email before handing over any personal or financial details. It’s also worth investing in a credit monitoring service to stay on top of any unusual activity on your credit accounts.

Jamela Adam is a personal finance writer covering topics such as savings, investing, mortgages, student loans, and more. Her work has appeared in Forbes Advisor, Chime, U.S. News & World Report, RateGenius and GOBankingRates, among other publications.