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Established Contributor
snowkitty
Posts: 985
Registered: ‎09-10-2012
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What is the best way to use these new credit cards?

I'm sorry for all the newbie questions but I am really trying to get this all worked out in my head. The new cards are starting to come in the mail so I want to know the best way to make use of them. As I mentioned in an earlier post, my credit had several charge off's 15 years ago and now everything has fell off and I am being approved for stuff again. I have a bofa visa (500.00), discover (1500.00), walmart (600.00) and amazon (600.00). I used the visa last week to buy groceries and then paid if off that Friday when I got paid. I assume this is what to do? I shop at walmart for groceries each week so should I only use that card for groceries weekly and then pay it off that friday? I bought a few gifts for upcoming events on the amazon card and will pay if off this week. I normally pay my utility bills with my debit card but should I put them on maybe the discover card and then pay if off a few days later? Is it ok to always be paying off early or is it better to have some sort of balance hit the statement each month and then pay it off?

 

If you pay off your balance each month before the statement is cut, does that show you always have a 0 balance to creditors in the future? Do they know you use the card all the time but then pay if off responsibly?

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Senior Contributor
jsucool76
Posts: 3,563
Registered: ‎12-11-2011
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Re: What is the best way to use these new credit cards?

I personally put everything i can on my cards (rewards) and then pay it off when my statement cuts.

If you plan on applying for credit then the suggested plan of action is to let all cards except one report a $0 balance and then have the other one report a balance of 1%-9%

If you dont plan on applying for credit though, use your card for whatever you like (don't go over ypur limit) and just pay it off by the due date to avoid interest. So long as you can afford to pay for everything you put on your card then there won't be an issue.
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Razeus
Posts: 395
Registered: ‎04-02-2012
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Re: What is the best way to use these new credit cards?

You don't have to pay it off everytime you make a charge.  You might as well use a debit card if you're going to do that.  The way to do it is:

 

1) Run your everyday expenses and bills through your card(s)

2) Pay the day before your statement cuts (so you need to know your statement date)

3) Pay again the bill is due.

 

I pay, or will pay, every 2 weeks or so and just let the cash stack in my checking account until then.  This forces 2 things:

 

1) You are only charging things you can afford - no going out buying that $200 sport coat or $500 purse just because you have the credit limit

2) You're paying your bills on time and paying attention to your finances; you're seeing where your money goes.

 

Of course you can buy yourself stuff IF you have the money and can PIF when the bill comes.  But with a credit card and the mentality that you HAVE to pay it off when the bill comes in (and/or before the statement cuts), it makes you think twice about what you are spending and if you really need what it is you're wanting to buy.

 

Remember: The odds of winning are in favor of the house.

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nicholasyud
Posts: 1,734
Registered: ‎08-13-2012
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Re: What is the best way to use these new credit cards?

Call your bank and ask them what the statement cut off day. Put it on your calendar down and mark it as a payment day for each specific credit cards. Example if your payment cut off day(this not a due date ) is on the 10th make a payment online on the 3rd of each m. And keep them report your balance on each card no more than 50 dollars. 

P


Starting Score: 560
Current Score: 748 Wishlist: CSP, Simply Cash, SPG, BOLD, INK, United MP,
Goal Score: 800


Walmart: 10k |Usaa: 8k|BCE: 9k| Amex: NSPL|Dis: 3.4k|Cap: 3.5k|CAP: 2k|CSP: 5k| Pen:4.5k

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snowkitty
Posts: 985
Registered: ‎09-10-2012
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Re: What is the best way to use these new credit cards?

Ok...so I will call my cards and ask when the statement cutoff day is. What exactly does this do for your credit report? I understand that will pay off your balance but then won't it look like you have credit lines that you never use to creditors? Or are you saying to pay it short 50.00 and then pay that 50.00 as soon as the bill comes in?

TU Fico 714 | Sesame 742 | Credit Karma 762 | Wal-Mart FICO 734 | EX FICO 695 (1/28/13) | EQ 740 (3-21-13)

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nicholasyud
Posts: 1,734
Registered: ‎08-13-2012
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Re: What is the best way to use these new credit cards?

Okay here the credit game . The creditor look at your report and see oh this guys had 1000 and he only using 50 it's mean he not live by credit and of course they grade you of as a good credit user cuzzz you don't hit your limit nor you only used part of it.

The cut off time is very important. Lets said when used my credit I use them very heavy but I'm Always paid it before the cut off days so when the credit card company report to credit bureaus they only see my usage only 10 over all 1000 credit limit which is lesthan 9% Utili......let's said if you have enough cash or debit card in your hand you don'tneeded to used your credit card then just paid it by your debit and cash. But just charge on each credit card about couple dollars and make sure they report some soft of balance due to your credit . Paid your bills on time and ask for limit increase every 6 months . Hoit's this help. 


Starting Score: 560
Current Score: 748 Wishlist: CSP, Simply Cash, SPG, BOLD, INK, United MP,
Goal Score: 800


Walmart: 10k |Usaa: 8k|BCE: 9k| Amex: NSPL|Dis: 3.4k|Cap: 3.5k|CAP: 2k|CSP: 5k| Pen:4.5k

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Razeus
Posts: 395
Registered: ‎04-02-2012
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Re: What is the best way to use these new credit cards?

You can PIF both times.  I'd leave one card to report no more than 10-15% of your credit line to help with FICO points.  Then when the bill is due, you just PIF that 10-15% so you don't pay any interest.  Interest payments is your enemy.

My Wallet:
Discover It $14,300 | Chase Sapphire Preferred $7,500 | Chase Freedom $5,000 | Citi Simplicity $5,000 | AMEX BCE $3,000 | Paypal Extras Platinum $5,000 | Wells Fargo $1,000 | AMEX Zync NPSL
Valued Contributor
nicholasyud
Posts: 1,734
Registered: ‎08-13-2012
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Re: What is the best way to use these new credit cards?

 

Example 

Charge 50 on Walmart card.

Cut off time 10.

Paid 48 on the 3rd one week before cut off time

Receice a new statement on the 11. 

Make another payment I guess $2.

 

They do report some soft of Balance.

You used less than 9%.

Do paid your bill on time.

 

Welcome to credit game

 


Starting Score: 560
Current Score: 748 Wishlist: CSP, Simply Cash, SPG, BOLD, INK, United MP,
Goal Score: 800


Walmart: 10k |Usaa: 8k|BCE: 9k| Amex: NSPL|Dis: 3.4k|Cap: 3.5k|CAP: 2k|CSP: 5k| Pen:4.5k

Valued Contributor
nicholasyud
Posts: 1,734
Registered: ‎08-13-2012
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Re: What is the best way to use these new credit cards?


Razeus wrote:

You can PIF both times.  I'd leave one card to report no more than 10-15% of your credit line to help with FICO points.  Then when the bill is due, you just PIF that 10-15% so you don't pay any interest.  Interest payments is your enemy.


did you test on your method what the best way for your Fico score "????? 

1. Used a ill bit on each card.

2. Used on one card and let other report $0. 


Starting Score: 560
Current Score: 748 Wishlist: CSP, Simply Cash, SPG, BOLD, INK, United MP,
Goal Score: 800


Walmart: 10k |Usaa: 8k|BCE: 9k| Amex: NSPL|Dis: 3.4k|Cap: 3.5k|CAP: 2k|CSP: 5k| Pen:4.5k

Established Contributor
snowkitty
Posts: 985
Registered: ‎09-10-2012
0

Re: What is the best way to use these new credit cards?


nicholasyud wrote:

Okay here the credit game . The creditor look at your report and see oh this guys had 1000 and he only using 50 it's mean he not live by credit and of course they grade you of as a good credit user cuzzz you don't hit your limit nor you only used part of it.

The cut off time is very important. Lets said when used my credit I use them very heavy but I'm Always paid it before the cut off days so when the credit card company report to credit bureaus they only see my usage only 10 over all 1000 credit limit which is lesthan 9% Utili......let's said if you have enough cash or debit card in your hand you don'tneeded to used your credit card then just paid it by your debit and cash. But just charge on each credit card about couple dollars and make sure they report some soft of balance due to your credit . Paid your bills on time and ask for limit increase every 6 months . Hoit's this help. 


 

Thanks....that makes sense. So beings I am paid weekly, it's not going to hurt if I pay what I owe each week rather than each month?? I would feel more comfortable doing that since I am just starting out until I learn all the ins and outs. My next question on paying everything off is this........If per say I use my discover card or amazon card in this way, why would those creditors want to up my limit when I never get close to it? Wouldn't they think it was un-needed because I don't use it anyways? I've been told to do it this way and to also call my cards periodically and ask for increases and I know why on my end but won't they want to know why and question me about it?

 

TU Fico 714 | Sesame 742 | Credit Karma 762 | Wal-Mart FICO 734 | EX FICO 695 (1/28/13) | EQ 740 (3-21-13)

Amex Blue Sky 7.2k | Amex BCE 13.1k | Citi Diamond Preferred 10.2k | CSP 5k | Bofa Cash 9k | Boa Travel 10k | Discover More 3k | Chase SW 5k | Wal-Mart 3.3k | Amazon 5k | Old Navy Visa 5k | Shell 1200 | BP 400 | VS 1500 | Sam's Discover 8.5k | FNBO Amex 16k | Chase Freedom 1.3k | Home Depot 5k | Brylane Homes 1600 | BML 2820

App free since 12/11/13*

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