Paying down CCs, a good idea?

[tduke]

For the past 18 months or so, I've made it a point to pay down all my CCs each month. My credit report has consistently shown $0 balance on all my 5 cards. 2 months ago, i had the equifax score watch thing. That same month, one of my cards had a $20 balance or thereabouts. Immediately, i got the following alert

This e-mail is to notify you that the following changes have occurred on your credit file:

• a credit score change
• an account balance increased by a specified percentage

My score went up about 7 points. The next month I paid off my balance and my score went down again. This totally confuses me. Should I keep balances on my cards? And if so, what's a good percentage I should keep on it? My cards and their limits are:

Discover $3500 (Primary card)

Chase Slate $2000

Chase Student $1300

Capital one $1500

Amazon GEMB $2500

I also have 2 student loans (total $28000) and an auto loan ($11000)

[spengbab]

From what I've seen they want to see responsible use of credit.

Don't keep a balance if you don't want, wait for the statement period to be over. At the end when it reports just pay it off. The balance will report.

I think a good usage is 20%-30%?

[Datx]

From what I heard it varies from person to person. You want to play around with numbers, but keep it around 9% total utilization reporting and see how it goes. Adjust and see what works out best for you.

[Walt_K]

For most people, optimum score is achieved by having one card report 9% or less of its CL (not 9% total utilization, 9% of that one card's CL), and all other cards report $0.  The exact sweet spot for each person can vary some, but that is what seems to work for most.

[jamesdwi]

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@tduke wrote:

For the past 18 months or so, I've made it a point to pay down all my CCs each month. My credit report has consistently shown $0 balance on all my 5 cards. 2 months ago, i had the equifax score watch thing. That same month, one of my cards had a $20 balance or thereabouts. Immediately, i got the following alert

This e-mail is to notify you that the following changes have occurred on your credit file:

• a credit score change
• an account balance increased by a specified percentage

My score went up about 7 points. The next month I paid off my balance and my score went down again. This totally confuses me. Should I keep balances on my cards? And if so, what's a good percentage I should keep on it? My cards and their limits are:

Discover $3500 (Primary card)

Chase Slate $2000

Chase Student $1300

Capital one $1500

Amazon GEMB $2500

I also have 2 student loans (total $28000) and an auto loan ($11000)

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The golden number is  .5 - 9% showing on one card, with 0% showing on the rest of your cards, the real trick, is to play the game and use other cards but never let any balance show on the other cards to keep  Fico happy. But your creditors want to see use of their card so you have to use them (at least once every 3-6 months) to keep happy but never show a balance

[LS2982]

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@tduke wrote:

For the past 18 months or so, I've made it a point to pay down all my CCs each month. My credit report has consistently shown $0 balance on all my 5 cards. 2 months ago, i had the equifax score watch thing. That same month, one of my cards had a $20 balance or thereabouts. Immediately, i got the following alert

This e-mail is to notify you that the following changes have occurred on your credit file:

• a credit score change
• an account balance increased by a specified percentage

My score went up about 7 points. The next month I paid off my balance and my score went down again. This totally confuses me. Should I keep balances on my cards? And if so, what's a good percentage I should keep on it? My cards and their limits are:

Discover $3500 (Primary card)

Chase Slate $2000

Chase Student $1300

Capital one $1500

Amazon GEMB $2500

I also have 2 student loans (total $28000) and an auto loan ($11000)

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You should keep a small 1-9% balance on only 1 of your credit cards (a bankcard is preferred) and all of your other cards should be zero'd out for the FICO tweaking for points.

[amercnchopz34]

So this 9% of the one card with balance.i thought it was 0-9% on total available cl's for all cards?

[MarineVietVet]

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@amercnchopz34 wrote:
So this 9% of the one card with balance.i thought it was 0-9% on total available cl's for all cards?

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Everyone's situation is different and there is no one size fits all approach to this but what seems to work well for most people is to have only one of their cards report a small (<9% of it's credit limit) balance each month and then pay in full before the due date. You can use it as much as you want during the month but what's important is the reported balance because for most cards whatever is reported on the monthly statement is what is used to calculate utilization for the month.

You might have to play around with the percentages for a few months to see what works best for you. Some people say that 1-3% utilization helps the most. For others it might be 5-9%. As I said it's not one size fits all.

On any other cards always try and have them report a zero balance each month. That doesn't mean you can't use them just make sure that the desired zero balance on these accounts is achieved several days before their statements post.

Along with individual and overall utilization, FICO also scores the number of all types of accounts reporting a balance.at any one time Making sure less than half of all your accounts report a balance helps most people.

Now this approach really isn't necessary if you're not looking to apply for any credit in the near future or unless you are trying to tweak your score for maximum effect but some folks do this as a hobby just to see how high they can get their score.

[amercnchopz34]

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@MarineVietVet wrote:

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@amercnchopz34 wrote:
So this 9% of the one card with balance.i thought it was 0-9% on total available cl's for all cards?

---

Everyone's situation is different and there is no one size fits all approach to this but what seems to work well for most people is to have only one of their cards report a small (<9% of it's credit limit) balance each month and then pay in full before the due date. You can use it as much as you want during the month but what's important is the reported balance because for most cards whatever is reported on the monthly statement is what is used to calculate utilization for the month.

You might have to play around with the percentages for a few months to see what works best for you. Some people say that 1-3% utilization helps the most. For others it might be 5-9%. As I said it's not one size fits all.

On any other cards always try and have them report a zero balance each month. That doesn't mean you can't use them just make sure that the desired zero balance on these accounts is achieved several days before their statements post.

Along with individual and overall utilization, FICO also scores the number of all types of accounts reporting a balance.at any one time Making sure less than half of all your accounts report a balance helps most people.

Now this approach really isn't necessary if you're not looking to apply for any credit in the near future or unless you are trying to tweak your score for maximum effect but some folks do this as a hobby just to see how high they can get their score.

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Thank u...I have along way to go then...I thought it was 0-9% on total CL for all..that is at 6%.. But I have one card reporting 500 on 2000 cl....it's needs to be around 180.00 to be at the 0-9-% described.. Thanks