Average Age of Accounts: How It's Calculated & Why It Matters

Your average age of accounts (AAoA) represents how long you've been managing credit—and it directly influences 15% of your FICO® Score. While not the largest scoring factor, AAoA can make or break approval decisions, especially for those with shorter credit histories. The calculation is straightforward: add up the ages of all your credit accounts and divide by the total number of accounts. What's less obvious is how everyday decisions—opening a new credit card, closing an old one, or becoming an authorized user—can dramatically shift this number. This guide breaks down exactly how AAoA works, what constitutes a "good" average age, and strategic moves to build credit history without inadvertently hurting your score.

What Is Average Age of Accounts?

Average age of accounts measures the typical length of time your credit accounts have been open. It's one of several components that make up the "Length of Credit History" factor in FICO® scoring models, which accounts for 15% of your total credit score.

When lenders review your credit, they're essentially asking: "How much experience does this person have managing credit responsibly?" A longer credit history provides more data points, giving lenders confidence in your ability to repay debt. Someone who has successfully managed credit cards, loans, and other accounts for a decade presents less risk than someone with only a year of credit experience.

The length of credit history factor considers multiple elements according to myFICO:

• Age of your oldest account
• Age of your newest account
• Average age of all accounts
• How long specific credit accounts have been established
• How long since you've used certain accounts

This means your AAoA doesn't exist in isolation—it works alongside other age-related metrics to paint a complete picture of your credit experience.

How Average Age of Accounts Is Calculated

The AAoA formula is mathematically simple:

Average Age of Accounts = Sum of All Account Ages ÷ Total Number of Accounts

Here's how this works in practice. Suppose you have three credit accounts:

• Credit Card A: Opened 8 years ago
• Credit Card B: Opened 4 years ago
• Auto Loan: Opened 2 years ago

Your calculation would be: (8 + 4 + 2) ÷ 3 = 4.67 years

This average represents your overall credit experience. However, understanding the calculation reveals an important insight: every new account you open immediately lowers your average, while keeping old accounts open maintains or increases it over time.

What Accounts Count Toward AAoA?

All accounts on your credit report typically factor into this calculation, including:

• Open revolving accounts: Credit cards, retail cards, and home equity lines of credit (HELOCs)
• Open installment accounts: Mortgages, auto loans, personal loans, and student loans
• Closed accounts: These continue counting toward your AAoA as long as they remain on your credit report

According to the FTC, positive closed accounts (those paid as agreed) remain on your credit report for 10 years from the closure date. Negative accounts stay for 7 years from the date of first delinquency. During these periods, closed accounts continue aging and contributing to your AAoA calculation.

How Much Does AAoA Affect Your Credit Score?

Length of credit history, which includes AAoA, accounts for 15% of your FICO® Score. Here's how this compares to other factors:

While 15% might seem modest compared to payment history's 35%, it represents a significant scoring opportunity—or liability. According to myFICO, the importance of these categories varies by individual. For someone with a short credit history, this factor may carry extra weight.

What's a Good Average Age of Accounts?

FICO® doesn't publish official AAoA thresholds, but industry research and credit scoring patterns suggest these general benchmarks:

The CFPB emphasizes that "a long credit history will help your score" because it provides more information about your borrowing patterns. The more payment history data available, the more accurately lenders can assess your creditworthiness.

Understanding credit score basics helps contextualize these benchmarks. An excellent AAoA won't compensate for missed payments, but all else being equal, a longer credit history positions you as a lower-risk borrower.

How Opening New Accounts Affects Your AAoA

Opening a new credit account creates immediate ripple effects across your credit profile. Let's examine a practical scenario:

Before opening new account:

• Credit Card A: 10 years old
• Credit Card B: 6 years old
• Auto Loan: 4 years old
• AAoA: (10 + 6 + 4) ÷ 3 = 6.67 years

After opening new credit card:

• Credit Card A: 10 years old
• Credit Card B: 6 years old
• Auto Loan: 4 years old
• New Credit Card: 0 years old
• AAoA: (10 + 6 + 4 + 0) ÷ 4 = 5 years

One new account dropped the AAoA by 1.67 years—a significant shift that could move someone from "good" to "fair" territory. This mathematical reality explains why myFICO advises: "If you have been managing credit for a short time, don't open a lot of new accounts too rapidly."

The Triple Impact of New Accounts

Beyond lowering your AAoA, new accounts affect your score in additional ways:

1. Hard inquiry: Each application typically generates a hard inquiry, which remains on your report for 2 years and affects your score for approximately 12 months. Learn more about the differences between hard vs. soft credit inquiries.

2. New credit risk signal: Lenders view rapid account opening as a potential financial stress indicator.

3. Credit utilization changes: A new card with zero balance can improve overall utilization, but this benefit must be weighed against the age-related downsides.

The Rate Shopping Exception

Not all inquiries are treated equally. FICO® scoring models recognize that consumers shop around for the best mortgage, auto loan, or student loan rates. Multiple inquiries for these loan types within a 14-45 day window (depending on the FICO version) count as a single inquiry.

This exception doesn't apply to credit cards, personal loans, or retail accounts. Each of those applications counts separately.

Does Closing Accounts Hurt Your AAoA?

The relationship between closed accounts and AAoA is more nuanced than many realize. Contrary to popular belief, closing an account doesn't immediately remove it from your credit report or AAoA calculation.

According to myFICO: "Closing credit lines may hurt your score by reducing your overall available credit and increasing your credit utilization ratio." However, they also note that "closing an account doesn't make it disappear. A closed account will still appear on your credit report and may be considered when calculating your credit score."

Timeline of Closed Account Effects

The strategic implication: closing your oldest credit card won't immediately tank your AAoA. That account continues contributing to your average for a full decade. However, the more significant concern is credit utilization—losing that available credit limit can spike your utilization ratio, which affects the larger 30% "amounts owed" factor.

When Closing Accounts Makes Sense

Despite the general advice to keep accounts open, legitimate reasons to close include:

• Annual fees: A card you no longer use may not justify its ongoing cost
• Fraud concerns: Unused accounts can become targets
• Simplification: Managing fewer accounts reduces complexity
• Temptation removal: If you struggle with overspending

If you decide to close an account, avoid closing your oldest one. The age of that account will eventually disappear from your credit history, potentially causing a sudden AAoA drop years later.

The Authorized User Strategy for Building AAoA

One of the most effective shortcuts for building credit history is the authorized user strategy. When someone adds you as an authorized user on their credit card, that account's entire history—including its age—may appear on your credit report.

The CFPB lists becoming an authorized user among the key ways to build credit. Similarly, myFICO suggests: "See if you can get a friend or family member with good credit to be a co-applicant with you—this will help you establish your credit history."

How Authorized User AAoA Works

Imagine your parent has a credit card opened 15 years ago with perfect payment history. If they add you as an authorized user:

• That 15-year-old account may appear on your credit report
• The account age dates back to when it was originally opened, not when you were added
• You inherit the payment history (positive or negative)
• The account's utilization affects your credit score

Before authorized user addition:

• Student Credit Card: 1 year old
• AAoA: 1 year (Poor)

After authorized user addition:

• Student Credit Card: 1 year old
• Parent's Credit Card: 15 years old (as authorized user)
• AAoA: (1 + 15) ÷ 2 = 8 years (Very Good)

This single strategy can transform a thin credit file into one that appears well-established.

Choosing the Right Account

Not every authorized user opportunity provides equal benefit. Consider these factors:

1. Account age: Older accounts provide greater AAoA boost
2. Payment history: The primary cardholder's history becomes part of yours
3. Credit utilization: High balances on the card hurt your score too
4. Card issuer reporting: Not all issuers report authorized users to credit bureaus—verify before proceeding
5. Your relationship: Choose someone who maintains excellent credit habits

How Long Does It Take to Build Credit History?

Building meaningful credit history requires patience. According to FICO®, you need at least 6 months of credit activity on at least one account before a score can be generated. Beyond that baseline, here's a realistic timeline:

The CFPB notes that credit building "requires patience and consistent effort" and that changes may become visible within three to six months, though substantial improvement in the length factor takes years.

For those just starting, building credit from scratch involves strategic product choices that establish history while minimizing risk.

Strategies to Accelerate Credit History Building

While you can't artificially age your accounts, you can make strategic decisions:

1. Become an authorized user on a family member's long-standing account
2. Apply for a secured credit card as early as possible—the sooner you start, the sooner your history begins aging
3. Consider a credit-builder loan that reports to all three bureaus
4. Avoid unnecessary account opening that dilutes your average age
5. Keep existing accounts open unless there's a compelling reason to close

Common AAoA Mistakes to Avoid

Understanding what not to do is equally important:

Mistake 1: Opening Store Cards for Discounts

That 15% off offer at checkout creates a new account with zero age. For someone with a thin credit file, this single decision could meaningfully lower your AAoA.

Mistake 2: Closing Your Oldest Card

Even if you never use it, your oldest credit card anchors your credit history. If it has no annual fee, keep it open with an occasional small purchase.

Mistake 3: Account Shopping Sprees

Applying for multiple credit cards in a short period—whether for sign-up bonuses or building credit faster—creates a compound negative effect on both AAoA and new credit factors.

Mistake 4: Ignoring Authorized User Removal

If you're removed as an authorized user (or the account closes), that history may disappear from your report, potentially causing a sudden AAoA drop.

Mistake 5: Assuming Age Alone Determines Score

Someone with a 10-year AAoA but 35% credit utilization and late payments will score lower than someone with a 3-year AAoA and perfect payment history. AAoA matters, but it's not the dominant factor.

Monitoring Your Average Age of Accounts

Keeping track of your AAoA helps you make informed credit decisions. Most credit monitoring services display this metric, often under names like "credit age" or "account age."

You can also calculate it manually by reviewing your free annual credit reports from AnnualCreditReport.com, the only federally authorized source for free credit reports from all three bureaus.

When monitoring, pay attention to:

• Upcoming account removals: Closed accounts approaching the 10-year mark
• Authorized user status: Confirm accounts are still reporting
• New account impact: Model how potential applications would affect your average

Frequently Asked Questions

Conclusion

Average age of accounts represents a credit factor you can't rush—it inherently requires time. However, understanding how AAoA works enables smarter decisions that protect and gradually enhance this aspect of your credit profile.

Focus on these core principles:

1. Start early: The best time to open your first credit account was years ago. The second-best time is now.

2. Preserve existing accounts: Keep your oldest accounts open, even if rarely used. The age they contribute to your average outweighs minor inconveniences.

3. Be selective about new accounts: Every new account mathematically lowers your AAoA. Open new accounts only when there's genuine benefit.

4. Leverage authorized user relationships: If someone with excellent credit and long account history can add you as an authorized user, this provides an immediate AAoA boost.

5. Think long-term: Credit history rewards patience. Decisions that seem minor today—opening a store card, closing an old account—can affect your credit for years.

Remember that AAoA is just one component of your credit score. While working to build a longer credit history, maintain excellent habits in the factors that matter more: pay every bill on time and keep credit utilization low. Over time, as your accounts age naturally, the length-of-credit-history factor will increasingly work in your favor.