Credit Card Center Advertiser Disclosure

Valued Member
Posts: 58
Registered: ‎11-25-2012
0 Kudos

Re: New Credit Card Convert

Hi and welcome to the forums!


My philosophy is that if you wouldn't buy it without a credit card, then you shouldn't buy it just because you can put it on a card. I would also be nervous about putting $10k on a credit card and carrying a balance, even at 0% interest, unless I had the $10k sitting in the bank to pay it off.


I'm not sure from your post whether you do already have $10k saved up to spend on home improvements, and your $1k/month rule is just on how you spend it. If you don't have the money saved up, I definitely would not spend on credit without the cash to back it up, even at 0% interest. Or maybe you do have the money and are deciding whether to spend it on home improvements or paying off your mortgage faster. (Actually, paying off your student loans first is probably the best idea, since the interest rates are likely higher, and student loan debt can't be discharged in bankruptcy.)


Something to think about... You want to spend ~$10k on home improvements on a house that you are very likely to sell in 3-5 years, and you seem unsure whether you'll get that money back in the sale price. I know you want to enjoy the improvements for 3-5 years, but think about when you buy that new home, will it also have those upgrades (which means they'll be factored into the price), or will you also want to do them for your new home? Presumably you'll live in your new home for more than 3-5 years. I would just think about this. Maybe it is worth it to you to spend this money now, or maybe it isn't.


If you were determined to do this and you had the cash in hand, I would just do it all at once and pay it off the same month. If you need to save up the cash, I would do each piece after I had saved up the money. However, this would take longer, which would mean you have less time to enjoy the improvements. . . . So again I'm not sure if you should even spend the money on this current home.


247Diva wrote:


I can easily imagine spending $3-4K in one monthy, including a new stove, painting my living/dining room, and maybe just my kitchen and bathroom floors. I could immediately pay it off, but I'd rather spread it over 2-3 months, while I'm not being charged interest. 

I guess I don't see the point in spreading it out over 2-3 months if you can pay it off immediately. The max interest you can make in an online savings account is ~1% (annual rate), I think. Wouldn't be worth it to me.


I'm not sure if you already understand this distinction, but utilization is calculated based on the statement balance reported. So say you were planning on putting $10k on the card and paying it off the same month. You could pay off the entire amount (or a partial amount) before the statement cutoff date, and your utilization is based off the statement balance. But I think you are probably thinking of carrying a balance from month to month. 


If you do decide to do it all at once and carry a balance on your card, your utilization will shoot up, and your scores will decrease. So you should apply for new cards before doing that.


As for optimal number of credit cards, I've heard 3 is a good minimum. See #1 here. A lot of people on these boards have way more than 3 cards, which is fine if you can manage them. Personally, I have 3 cards and I'm not planning on getting more, because I don't want to maintain even more accounts. Smiley Tongue


I would look at your spending and determine which categories you spend the most in, and then look for cards that have rewards in those areas. Do you spend a lot on groceries, gas, restaurants, Amazon, travel, etc.? Once you figure out your spending, we can help you pick a card to maximize rewards. Smiley Happy Sign-up bonuses should also be kept in mind. You could use your home improvement spending to meet spending requirements. (But again, that should not be a reason to spend money if you weren't going to do so already.)

Amex BCP ($12,100) - US Bank Cash+ ($11,000) - BofA Travel Rewards ($10,000) - Citi Forward ($5,500)

Last HP: 6/11/13 (for BofA CLI)

Forums posts are not provided or commissioned by FICO. Forums posts have not been reviewed, approved or otherwise endorsed by FICO. It is not FICO's responsibility to ensure all posts and/or questions are answered.

† Advertiser Disclosure: The listings that appear on myFICO are from companies from which myFICO receives compensation, which may impact how and where products appear on myFICO (including, for example, the order in which they appear). myFICO does not review or include all companies or all available products.
‡ Credit cards for FICO Score ranges: The score ranges are guidelines based on internal myFICO analysis of actual applicant approvals, and having a FICO Score in a particular range does not guarantee you will be approved for credit cards recommended in that range. These ranges were not provided by any card issuer.

* For complete information, see the terms and conditions on the credit card issuer’s website. Once you click apply for this card, you will be directed to the issuer’s website where you may review the terms and conditions of the card before applying. While myFICO always strives to present the most accurate information, we show a summary to help you choose a product, not the full legal terms - and before applying you should understand the full terms of products as stated by the issuer itself.

Copyright ©2001-2015 Fair Isaac Corporation. All rights reserved.   | Terms of Use | Privacy Policy | Sitemap

IMPORTANT INFORMATION: All FICO® Score products made available on include a FICO® Score 8, along with additional FICO® Score versions. Your lender or insurer may use a different FICO® Score than the versions you receive from myFICO, or another type of credit score altogether. Learn more

FICO, myFICO, Score Watch, The score lenders use, and The Score That Matters are trademarks or registered trademarks of Fair Isaac Corporation. Equifax Credit Report is a trademark of Equifax, Inc. and its affiliated companies. Many factors affect your FICO Score and the interest rates you may receive. Fair Isaac is not a credit repair organization as defined under federal or state law, including the Credit Repair Organizations Act. Fair Isaac does not provide "credit repair" services or advice or assistance regarding "rebuilding" or "improving" your credit record, credit history or credit rating. FTC's website on credit.