Ever considered opening a retail credit card for an instant discount? You might be in for a shock if you are debt free. That's what a retired family member of our staff recently discovered. With ample income, investments, a home and no debt, he was surprised when he was turned down.

With tight credit markets, it is important that consumers understand how their credit score is influenced by their behavior. The most well-known credit scoring system was developed by Fair Isaac Corp. The FICO system takes credit-related data gathered by three credit bureaus and evaluates your credit usage. The resulting score is designed to provide lenders with a concise prediction of the risk of offering you more credit. It can affect the credit that is available to you and the terms that lenders offer you.

To calculate your FICO score, five areas are evaluated and each is assigned a different weight:

35 percent: payment history. Lenders review payment history on all your accounts; the length of your positive credit history; and the number and severity of any delinquencies. Bankruptcies, foreclosures, late payments and delinquencies can adversely affect your score. TIP: Set up automatic payment features to ensure on-time payments.

30 percent: amounts owed. Too many credit accounts and a high ratio of credit balances to credit limits can adversely affect your score. The level of debt paid off on term loans (like mortgages) also affects your score. TIP: Keep credit card balances below 10 percent of credit limit for best scores.

15 percent: length of credit history. Longer credit histories result in higher scores. The length of time specific accounts have been open and the duration of time since each account was last used are important factors. TIP: Keep old accounts open even if you use them just once a year.

10 percent: new credit. Credit scores track consumers who suddenly take on new debt, potentially becoming overextended. They include the last time a consumer opened an account and how many accounts were opened. Inquiries on your credit reports cause your credit score to go down. TIP: Avoid opening new credit cards at the same time you are applying for a loan.

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10 percent: types of credit used. Your score improves if you are using credit for large ticket items like a car payment or mortgage. Your score goes down if you have a lot of revolving credit cards. TIP: A "healthy mix" of installment loans and revolving credit from banks is considered optimal for your score.

The FICO scores range from 300 to 850, with the majority in the 600 to 800 range. AnnualCreditReport.com provides one free credit report annually from each of the three credit reporting bureaus. This credit history information is free, but there is a fee to obtain your credit score.

Knowing your credit score is part of empowering yourself for your financial future. Increasing your score just takes time, persistence and an understanding of the process.

Barbara Ollinger is a senior adviser and certified financial planner with HTG Investment Advisors, of New Canaan, an independent fee-only advisory firm. She is involved in the design and implementation of investment portfolios to meet her clients' objectives. She also provides counsel to clients regarding their financial planning concerns, including retirement, taxes, education and estate planning. For information, call 203-972-8262 or visit www.htginvestmentadvisors.com.