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I have 500$ to put towards debt

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Anonymous
Not applicable

I have 500$ to put towards debt

Which would help my score the most:

  1. Splitting up the 500$ over multiple credit cards to lower my "high balance" cards?
  2. Pay off some of my smaller credit cards

Have about 5 CC's that I DO NOT use anymore. The lowest utilization rate is probably 40%. Highest is probably 85%

Message 1 of 3
2 REPLIES 2
Shogun
Moderator Emeritus

Re: I have 500$ to put towards debt

Personal opinion.  Pay off the smaller ones.  You don't have to worry about them anymore.  Now take what you were paying on those monthly and roll into your next lowest one.   Snowball effect.  You see results and gives you motivation.

Starting Score: 504
July 2013 score:
EQ FICO 819, TU08 778, EX "806 lender pull 07/26/2013
Goal Score: All Scores 760+, Newest goal 800+
Take the myFICO Fitness Challenge

Current scores after adding $81K in CLs and 2 new cars since July 2013
EQ:809 TU 777 EX 790 Now it's just garden time!

June 2017 update: All scores over 820, just pure gardening now.
Message 2 of 3
HoldingOntoHope
Valued Contributor

Re: I have 500$ to put towards debt

Additionally one of the FICO scoring criteria is "Number of accounts with balances". It seems as if FICO likes to see less than 1/2 of accounts to carry a balance. As a for instance, if you have 5 accounts FICO wants to see a balance on 2 or less. And this applies to all accounts total including installment. Since my installment accounts reported have quite a while before payoff it means I have to be very careful with my revolving accounts for this scoring factor.

 

It may only be a small portion of the total FICO scoring algorithm but I brought up this point since your concern was on your score and not necessarily best debt management. Many here advocate for paying down highest interest obligations first regardless of balances in order to save money.

Best financial advice I ever got: "Just imagine what an adult would do and do that."

Starting Score: 500's
Current Score: EQ 701 (FICO) TU 721 (FICO) EX 715 (Quizzle)
Goal Score: 760 ALL


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