Using Credit Cards to Improve credit

[Anonymous]

Hi everyone,

I'm trying to learn as much as I can about credit cards, and how to use them to your advantage so you get the most out of them for improving your credit score.  I was ignorant abou credit in the past, and thought there was nothing wrong with closing CCs, including the first one I ever opened. Big mistake, I know. Well now I know better, and want to put the cards I do have to good use. Right now, I have a Chase Credit Card ($4100 limit), AMEX Blue Cash ($4200 limit), and a Discover Roads ($3200 limit). My overall monthly CC spending is about $900 a month. What would be the best way to go about using them to my advantage for my credit score? Should I spend equally with the cards, and them pay them all off at the end of month? If so, is it a good idea to pay them off before the statement cut off, or before?

Thanks for any advice,

Tyler

[Anonymous]

All FICO cares about is the balance that is reported to them.

Different CC report at different times of the month.

You need to do some research here on the forums and/or call the CCC and find out when they report.

If you only have 3 cards, I wouldn't let but 1 report a balance.

Don't let it report more than 9% of it's CL and keep your total util between 1-9%.

[llecs]

And outside of letting them age, a mix of credit can be helpful too. I bet if you added a store charge card (non-Visa), you'll see an overall bump, albeit relatively small in the long term (maybe 10 pts or less).

[Anonymous]

My recommendation is to get a calendar. Organize your cards...say you have a WaMu Visa, a Hooters, and a Target card. For October, write "WaMu." November, "Hooters." December, "Target." January, "WaMu." And so on, in rotation.

At the beginning of the month, take that month's card and buy something small with it (less than 10% of the credit limit). Let it report on your statement (the statement balance is what reports to the CRAs) and then PIF. This way, each month you'll have one card reporting a small balance. Each card will be used at least once a quarter.

If you have 4-6 cards, write in the names of two cards each month. If you have 7-9 cards, three. And so on. You want to use each card at least once a quarter.